BUDGET SEIS
From the Earth to the Moon Ltd has been approved by HMRC as an SEIS, enabling the following tax benefits for investors:
50% tax relief is available on any investment up to £150,000. Therefore £60,000 investment in our SEIS will give you a £30,000 credit against your tax bill (there must be an income tax liability at least equal to the credit claimed)
All gains in SEIS are free of capital gains tax providing the investment is kept intact for 3 years. This saves an additional 28% tax on gains at current rates. There is an extra relief called capital gains reinvestment relief. This is useful to you if you have recently paid capital gains tax on other investments.
You can reclaim up to 50 per cent of the tax paid if you reinvest that money into SEIS. The investment also takes that amount invested out of the scope of inheritance tax after 2 years, which is attractive to those looking to take their minimise their estate’s exposure to tax, whilst retaining control of their investments.
Any losses incurred in SEIS can be offset by individuals against income of the tax year of the loss, or the previous year, or against capital gains of the tax year of the loss and future years.
The development investment is made directly into shares of From the Earth to the Moon Ltd and the initial SEIS investment is capped at 2% (of the 50% of investment equity available) for £150,000.
Equity is held on a 50/50 basis between investors and producers (investors take first recoupment position).
No fees or commissions are charged.
Investors should seek advice from their own professional advisers as to the suitability of the investment and their entitlement to tax relief. HMRC publish relevant information on their website. http://www.hmrc.gov.uk/seedeis
A PDF of HMRC’s guidance on EIS - An Introduction to the Enterprise Investment Scheme (EIS) - can be downloaded from their website.
The SEIS will be administered by our accountants Grant Thornton UK LLP who are members of the Enterprise Investment Scheme Association which is the only trade body recognised by HMRC and HM Treasury.
INVESTMENT OPPORTUNITIES
BUDGET EIS
Once SEIS funds are secured, From the Earth to the Moon Ltd reverts back to EIS status. The remaining 98% of available equity in the £8m production, enables the following tax benefits:
Tax relief of 30% can be claimed on investments (up to £1,000,000 in one tax year) giving a maximum tax reduction in any one year of £300,000, provided you have sufficient Income Tax liability to cover it.
EIS allowances are allocated individually; therefore a married couple could invest up to £2 million each tax year and be eligible for Income tax relief.
The investment must be kept intact for 3 years after which all gains are free of all taxes regardless of the profits with no ceiling.
Payment of CGT can be deferred when the gain is invested in shares of From the Earth to the Moon Ltd. This allowance is given on top of the 30% relief above.
At current rates this will save 28% tax on that gain which would otherwise be payable.
The gain can arise from the disposal of any kind of asset, but the investment must be made within the period 1 year before or 3 years after the gain arose.
The investment also takes that amount invested out of the scope of inheritance tax after 2 years, which is attractive to those looking to take their minimise
their estate’s exposure to tax, whilst retaining control of their investments.
In the event of losses, then that loss, less the credit already received, can be offset against any other income. Investors should seek advice from their own professional advisers as to the suitability of the investment and their entitlement to tax relief.
HMRC publish relevant information on their website. http://www.hmrc.gov.uk/eis/ A PDF of HMRC’s guidance on EIS - An Introduction to the Enterprise Investment Scheme (EIS) - can be downloaded from their website