In X-Wind Power Limited v HMRC [2017] UKUT 0290 (TCC) the Upper Tax Tribunal (UT) considered whether relief under the SEIS was blocked because the company filed an EIS (rather than SEIS) compliance statement in error. It was.

  • X-Wind issued shares under the SEIS in a number of tranches
  • in March 2013 the company submitted a compliance statement to HMRC but used form EIS1 not SEIS1; this was agreed to be an innocent error but nothing indicated to HMRC that this should have been SEIS
  • In May 2013 HMRC authorised X-Wind to issue EIS compliance certificates to its investors
  • In April 2014 an SEIS compliance statement was submitted, this one correct
  • HMRC refused to authorise SEIS compliance certificates as SEIS is not available once there has been an EIS investment
  • In May 2014 X-Wind submitted form SEIS1 to replace the March 2013 submission
  • HMRC refused to accept the replacement submission
  • The company appealed to the First Tier Tribunal (FTT).

The FTT held

  • The EIS1 was validly submitted ergo could not be voided
  • The compliance statements are not claims under s42(9) of TMA so there was no statutory right to submit a replacement.
  • The SEIS was, therefore, not available on any of the investments.

On appeal the UT confirmed the FTT decision.

Comment:

Make sure you use the right forms!

The comments (from the FTT) that nothing indicated to HMRC that the first submission should have related to SEIS suggest that the decision could have gone differently if a suitable covering letter had been included. The case does not indicate whether advanced assurance was sought before issuing shares.

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X-Wind Power Limited v HMRC [2017] UKUT 0290 (TCC)

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