What is the Enterprise Investment Scheme?
A more specialist investment in smaller firms for people who are comfortable with high risk.
The Enterprise Investment Scheme (EIS) is a government-backed initiative offering tax reliefs to investors who buy new shares in qualifying companies.
Why this type of investment?
We offer this type of investment to clients who want to hold shares in small companies with the potential to grow. These clients must also be comfortable taking on the risks of backing these businesses at an early stage and be willing to stay invested for the long-term.
As with any investment, there is an element of risk involved and we ensure our clients are aware of these risks before choosing an Enterprise Investment Scheme investment. We make our clients aware that not all EIS-qualifying companies will be successful and the shares of those that fail will lose all their value.
Pros and Cons of Enterprise Investment Schemes
The reasons to invest in an Enterprise Investment Scheme are:
- Support UK business growth
- Tax incentives
- High growth potential
- Complements other long-term investments
The risks associated with Enterprise Investment Scheme are:
- Tax treatment may change depending on your individual circumstances
- Capital is at risk
- Investors need to hold shares for three years to keep any tax reliefs claimed
- Volatility and liquidity
To find out if you are the type of investor who could benefit from the Enterprise Investment Scheme then please get in touch to arrange a call or meeting.
*Please note: Enterprise Investment Schemes are high risk investment into smaller, unlisted companies. They are not suitable for the majority of investors. EIS maybe difficult to sell and investment should be considered over the longer term, over five years minimum. Investments carry risk, you could lose your capital. The tax benefits of EIS will depend on your individual circumstances. Tax laws can change. Any tax reliefs depend on the EIS companies maintaining their qualifying status.