Re-investment relief, also known as  deferral relief, is one of the tax reliefs available under the enterprise  investment scheme (EIS). If an individual sells an asset and reinvests the sale  proceeds in subscribing for qualifying EIS shares, he can defer the capital  gains tax liability on the asset by claiming EIS re-investment relief.

The conditions to be met for deferral  relief are less strict than for income tax relief; many investors will qualify  for deferral relief without qualifying for income tax relief.

There is no minimum amount of investment  required to qualify for EIS deferral relief and the maximum is only limited by  the overall risk finance investments annual permitted maximum. The cap is £5m  per annum total relevant investments in the issuing company (ie investments  under EIS, seed enterprise investment scheme (SEIS), venture capital trusts  (VCTs), and investments in social enterprises). Note that the other investment  caps in ITA 2007, ss 173AA, 173AB that apply for income tax relief purposes from  18 November 2015 onwards do no apply for EIS deferral relief. TCGA 1992, Sch  5B, para 1(2)(da)

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