Mercia's Knowledge-intensive EIS Fund

The main attraction for investors of a knowledge-intensive EIS is that it is HMRC-approved, which means that the investment date for tax purposes is the tax year of the fund close, rather than the tax year in which funds are deployed. 

We are targeting a deployment of 6 months for this fund, to optimise how quickly we can start creating value in portfolio companies, and so clients can benefit from the cash flow from tax reliefs.

As usual with an EIS, you may claim up to 30% income tax relief on EIS investments in the tax year of the investment date or carry back to the previous tax year. However, with this approved fund, not relying on the speed of deployment you may with more certainty target the desired tax year for income tax relief and carry back one year earlier than with a typical EIS.

There is also reduced administration when claiming back the tax, as only a single EIS5 tax certificate is issued upon completion of deployment.

Again, as usual with EIS, capital gains deferral (of any size) can be made up to three years before and one year after the investment and you may defer a gain even if you have already paid the tax. Most EIS-qualifying investments attract 100% Inheritance Tax relief via Business Relief.

Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong. Take 2 minutes to learn more.