HMRC offers an advance assurance application service for both the Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS).

Companies can apply to HMRC in advance of offering shares under either scheme to check that they meet the stringent qualifying criteria.

Companies will need to complete an application form to provide their details and tax reference together with the following information for HMRC:

The following documents and information are required:

  • Details of the amounts intended to be raised.
  • Details of what these monies will be used for.
  • Latest company accounts and accounts of any subsidiary company.
  • Details of all trading or other activities to be carried on by the company and any subsidiary and details of which company(ies) will use the money raised by the share issue.
  • The latest draft of any prospectus or similar document to be issued to potential investors.
  • The company's business plan.
  • An up-to-date copy of the Memorandum and Articles of Association with details of any changes to be made.
  • A copy of the register of members at the date of submission of the advance assurance application or at the date of the EIS1 compliance statement.
  • Details of any subscription agreement or other side agreement to be entered into by the shareholders.
  • Any other information relevant to this application.
  • The company must explain how the money will be used to promote the new growth and development condition.
  • A company that doesn’t meet the new general age limit will need to show how the qualifying conditions are met.
  • Documents to support the company’s view that it is a knowledge intensive company, if applicable.

For SEIS applications only:

  • Details of any other ‘de minimis aid’ received.
  • Confirmation that no shares which qualified for EIS have previously been issued or that the company has not received any previous investment from a Venture Capital Trust.

The form can be completed and submitted by:

  • A company secretary
  • A director
  • An agent you have authorised to act on your behalf.

What’s new?

In December 2017 HMRC in response to its consultation 'Tax-advantaged venture capital schemes – streamlining the advance assurance service', confirms that the service will continue, with a number of steps to improve the service.

  1. Digitisation
  2. As a discretionary, non-statutory service, HMRC may decline to give an opinion
  3. Where a company is relying on a particular interpretation, it should provide a full technical analysis of how it meets that law. HMRC will not opine where it believes the application is testing the limits, not seeking to allay genuine concerns
  4. From 2 January 2018, HMRC will not opine on speculative applications. The company should have approached potential investors, and name the individual(s), fund manager(s) and other promoter(s) who are expected to invest.
  5. From 4 December 2017, HMRC will not opine where it is reasonable to conclude that the investment is part of a capital preservation scheme

HMRC will also improve its guidance, including a checklist setting out the documents and information the company needs to provide, as well as a FAQ.

 

Updates

12/12/17 Condoc response added

6 December 2016 Reference to consultation added.

10 November 2016 Updated to add in details as to who can complete and submit an application.

26 September 2016 Updated for HMRC’s latest advice on Advance Assurance applications following Finance (no 2) Act 2015 changes.

 

 

 

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