How to Claim EIS Relief

In this article we want to explain to those of you that are elegible to claim Income Tax relief under the Enterprise Investment Scheme how to do so. The general rule is that the relief is available for the tax year in which the shares are issued. But if you choose, you can treat some or all of the shares as issued in the previous year and claim relief in that previous year, subject to the maximum £1 million relief limit for the year.

Once HMRC have authorised the tax submissions made by Wiltshire Wildlife Community Energy we will be permitted to distribute to all qualifying investors a Form EIS 3 which sets out the amount invested and states that the investment is eligible for tax relief.

For Investors who Normally Complete a Tax Return Form

You need to claim the relief on your Tax Return form by completing the Additional Information Section. In Box No 2 on Page 2 you need to enter the total value of the investment upon which you are claiming relief. In the large box on Page 4 of the Additional Information Section you need to provide details of the name of the company invested in, the amount invested, the date of issue of the shares and the name and reference number of the HMRC office issuing the tax certificate. All this information can be found on the EIS certificate we will issue.

You do not need to complete pages 3 and 4 of the EIS certificate. You do not need to send the EIS Certificate to HMRC but you do need to retain it in a safe place. HMRC may request to see the certificate as evidence in support of your claim.

The tax relief will normally be allowed in the year in which the shares were issued to you. If you wish to claim relief against the previous tax year you can either amend the Tax Return previously submitted for the earlier year, or fill out Page 3and 4 as detailed below and send it to your HMRC office.

For Investors who do not Normally Complete a Tax Return Form

If you are employed under PAYE or retired and do not normally complete a Tax Return form, the procedure for claiming relief against tax deducted from you is slightly different. You need to complete the blank sections on Pages 3 and 4 of the EIS Certificate. The details you need about the date of issue and the HMRC office reference number can be found on Page 1 of the certificate.

Detach Pages 3 and 4 of the EIS certificate and send it to the HMRC office that deals with your tax deductions. If you are employed or have a pension from a former employer you will be able to find details of the HMRC office dealing with your affairs from your employer. If you cannot find this information you will need to telephone HMRC on 0300 2003300.