Tax holiday for Seed Enterprise Investment Scheme is more of an ‘early closing day’
20 March 2013
Patrick Stevens, EY tax partner comments on the Seed Enterprise Investment Scheme:
“The announced extension of the capital gains tax holiday for Seed Enterprise Investment Scheme (SEIS) is really only half a holiday – more of an “early closing day”.
“The Chancellor has announced that the capital gains tax holiday for 2012/13, designed to encourage investment in Seed Enterprise Investment Schemes, will be extended to 2013/14. (The relief exempted capital gains, where the proceeds of disposals were invested in qualifying investments). However, the detail in the accompanying documents makes clear that whereas the holiday for 2012/13 allowed for exemption of the whole gain, the extended holiday will only exempt gains up to the value of half the amount invested.
“Anything that helps encourage and fund start-up businesses must be good news, but the low investment limits for SEIS investments mean this is unlikely to have a huge impact on the economy as a whole.”