SEIS and EIS PRIVATE & CONFIDENTIAL Raising money through SEIS and EIS 01 June 2020
What I I will be covering today: • Introduction to Sapphire. • What is SEIS and EIS? • What are the benefits to investors? • Overview of qualifying conditions Companies must meet. • How can Overseas Companies qualify for SEIS and EIS • Knowledge Intensive Companies. • Application process. • Ways to raise money through SEIS and EIS. • Questions?
Sapphire Capital Partners LLP Structuring SEIS and EIS companies for Compliance Fund Investor Advance Statements Management Documents investment under Assurance SEIS and EIS.
What is SEIS and EIS IS • UK Government backed investment scheme to support start-ups. • Encourages innovation and company growth by offering UK investors attractive tax relief’s. • Allows start-up, high risk companies raise much needed capital. • Both UK and Overseas Companies can raise money through the Schemes.
What are some SEIS: EIS: Income Tax Relief: 50% 30% benefits to UK Max amount to invest per £100,000 £1,000,000 person per year: Loss Relief Yes Yes investors? Minimum qualifying period 3 Years 3 Years Inheritance tax relief Yes Yes No Capital gains tax to pay Yes Yes on any gains after the qualifying period: Tax Free Dividends No No
Overview of of qual alify fyin ing con onditions Companie ies must meet. • Company must carry out a qualifying trade. • Cannot be controlled by another company. • Needs to have intention to grow and develop over the long term. • Must not be listed on recognized stock exchange (AIM is qualifying). • Investment raised must be spent within two years.
How can Overseas Co Companie ies quali lify fy for r SE SEIS IS and EIS: IS: • Must have a permanent establishment in the UK. A UK agent can act as a permanent establishment. • The Company needs to have a Customer Registration Number (“CRN”) and a Unique Tax Reference (“UTR”). • Open a UK branch via Companies House (OSIN01 Form).
Knowledge In Intensive Companies • Defined as a company that is carrying out innovation or R&D. • £20m raise (£10m per year). • Investors can invest £2m per year. • Receive investment within 10 years of commercial sale. • 500 full time employees.
Some Statistics: • £2B was raised through EIS in 2017/18 (4,130 companies). • £20B has been raised through EIS since 1994 (29,770 companies). • £189m raised through SEIS in 2017/18 (2,320 companies). • £1B has been raised through SEIS since 2012 (12,900 companies).
Application Process for Advance Assurance UP TO DATE BUSINESS PLAN. MOST RELEVANT SET OF DIRECTORS RESOLUTION. TWO-YEAR FINANCIAL COVER LETTER. ACCOUNTS IF APPLICABLE. PROJECTIONS SHOWN MONTHLY. RELEVANT SUPPORTING UTR NUMBER. DOCUMENTS (SUBSIDIARIES/IP ETC/ SHAREHOLDERS AGREEMENT).
Ways to raise money through SEIS and EIS IS. ANGEL FUNDS CROWDFUNDING SYNDICATES INVESTOR INVESTORS NETWORKS
• Johnathan Graham Questions • Graham Capital Partners LLP • Johnathan@sapphirecapitalpartners.co.uk • +44(0)7833085164
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