Enterprise Investment Scheme (EIS)

• Income tax relief at 30% of the amount invested, on up to £1 million in a tax year.
• Up to £2 million where the amount above £1 million goes into knowledge-intensive companies.
• Unlimited deferral of a capital gain reinvested into EIS shares.
• Capital gains tax exemption on growth, after three years.
• Loss relief on the net cost if the company fails.
• Inheritance tax business relief on qualifying shares held for at least two years.

An EIS subscription can be carried back to the previous tax year, subject to that year's annual limit. This is useful where your liability in the current year is not large enough to absorb the relief, or where the previous year was a higher-income year.

• Up to £5 million raised in any twelve months and £12 million over the company's lifetime, with higher limits for knowledge-intensive companies.
• Gross assets of no more than £15 million immediately before the share issue.
• Fewer than 250 full-time equivalent employees, or 500 for knowledge-intensive companies.
• Within seven years of first commercial sale, or ten years for knowledge-intensive companies.

You cannot claim until the company issues your EIS3 certificate, which it can only do once it has been trading for four months. In practice this usually means several months after the round closes.

The claim is then made through self assessment. Keep the EIS3 certificate; HMRC may ask for it.