SEIS and EIS for Media Companies
The Enterprise Investment Scheme and Seed Enterprise Investment Scheme are Government backed initiatives created to stimulate entrepreneurship and encourage private investment into unlisted businesses. The initiative is based on providing investors with attractive tax reliefs in return for their investment.
By their nature both schemes are particularly suited to investment into creative sector and innovative businesses.
An overview of the tax advantages of SEIS and EIS:
50% of the amount you invest into a company qualifying for SEIS can be claimed back against income tax that you have paid in the year of investment. Alternatively you can carry back to the previous tax year.
SEIS 50% Capital Gains Tax Wipe Out
Any gains you make and then reinvest (in the same tax year) are taxable at 50% of normal rate in respect of eligible claims for SEIS relief
30% of the amount you invest into a company qualifying for EIS can be claimed back against income tax that you have paid in the year of investment. Alternatively you can carry back to the previous tax year.
EIS Capital Gains Tax Deferral
If you invest the amount of a chargeable gain for the sale of another asset into an EIS qualifying company, you can defer CGT. This can apply to gains that occur in the period from up to three years prior to the date of the EIS investment and up to one year after.
SEIS and EIS Tax Free Gains
Profits from the sale of your SEIS and EIS shares to third parties are exempt from CGT, providing you have owned the shares for three years or longer.
Investments in SEIS and EIS companies are free of IHT as long as the shares have been held for at least two years by the investor prior to the date of his/her death.