For the investor to qualify for any of the available enterprise investment scheme (EIS) tax reliefs, the investment must be in an EIS qualifying company. For more detail on the tax reliefs, see the Enterprise investment scheme tax relief guidance note.

The rules which determine whether a company is qualifying for the purposes of EIS can be broken down into four main categories:

  • the type of company
  • the amount of money it can raise
  • how and when the money raised is used in the trade
  • the type of activities carried on by the company

ITA 2007, ss 172, 180

Note that a sunset clause for EIS income tax relief has been introduced. This ensures that income tax relief will no longer be given to subscriptions made on or after 6 April 2025, unless the legislation is renewed by Treasury Order. ITA 2007, s 157(1)(aa), (1A)

Type of company which can use the EIS to raise money

The company must:

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