The Enterprise Investment Scheme Association (EISA) has published a new guide to help advisers understand and explain changes in the tax-efficient investing scheme, following the Autumn 2017 Budget.
The free guide – “EIS: new landscape, new opportunities” – explains the background to the changes and why capital preservation schemes will no longer be able to take advantage of the generous benefits associated with EIS.
It also highlights the enhanced terms, including the doubling of the amount that can be invested by individuals through EIS, from £1m to £2m. There has also been an increase in the amount that can be invested in total in so-called “knowledge-intensive” companies – from £5m to £10m.
Mark Brownridge (pictured), Director General of EISA, which is the trade body for the industry, said: “A detailed survey we conducted with advisers in the wake of the Budget announcement showed that half expect to see more investor interest now. Even many advisers who have never used EIS products before are recognising that they will be challenged to discuss the options with clients in the months and years ahead, so we felt it was important to produce a guide to help explain to everyone where EIS now stands.”
Laurence Callcut, Partner at Downing LLP, which co-sponsored the guide, said: “Before the Budget there was a lot of speculation that EISs were at risk. So when the Chancellor announced that there were no changes to the underlying tax reliefs and he was doubling some of the investment limits, this was most welcome.”
“EISs have resulted in over £16 billion pounds* of investment capital for British entrepreneurs – much of it through EIS managers like Downing, which not only identify promising businesses but also support their management teams through the difficult early growth and development stages. We can now be confident in continuing that good work.”
Donna Harding, Marketing Manager at guide sponsor Blackfinch, said: “We see the commitment to double investment allowances as a positive signal that the Chancellor recognises the important role EIS has to play in supporting the growth of the British economy.
“Investors now know EIS is open for business and the industry has been given very clear guidance about what will be acceptable in the future.”
“EIS: new landscape, new opportunities” is available from here.