EIS shares are the investments made by the companies to help their businesses grow to great extents. The enterprise investment scheme was launched by the government in 1994 to help small firms and start-ups raise money.
By investing in EIS shares, businessmen and entrepreneurs can receive tax relief. Nowadays, private companies play a major role in getting enterprise investment schemes.
The Enterprise Investment Schemes can claim 30% income tax relief for the companies and make the investors pay less for their business.
The Role Of Private Companies In The Eis Shares
Provide Access To Capital
The businesses and the investors can reap the benefits of investing in EIS shares. It provides the entrepreneurs with access to equity capital to provide funds for developing the business.
Are A Long-Term Finance Option
These shares are a tax-free investment that provides the businesses with some money. Raising finance in the form of equity makes the balance sheet look good.
Also, one can obtain financial assistance from other sources such as banks. Corporations come across professional people who can provide some tips on how to raise the business and get worldwide recognition.
Do Not Require Capital Gains Tax
The investors do not have to pay the capital gains tax for making the investments. The fact that the businesses are exempted from paying the tax makes these schemes worthwhile.
Help Get More Returns
The investors can receive more returns from the shares. They get the same rate of return per pound that they invested earlier.
Apart from this, the entrepreneurs hold these investments for three years to bring them more interest and long-term profits.
Free Of IHT
The EIS shares are exempted from the inheritance tax. The companies do not have to pay any tax if they have held the investment for two years.
Is Easy To Invest In EIS
One might invest in the EIS shares by directly contacting an EIS company or taking the help of a fund manager who can take things forward.
Accelerate Business Growth
The EIS shares accelerate the economy. These investments make business endeavours worthwhile. Not only this, these shares are valid for three years so there is no capital gains tax levied.
Summing it up, the EIS shares lead to the growth of businesses. These provide the entrepreneurs with numerous monetary benefits and they are exempted from paying all the taxes. To invest in the EIS, a company could have some gross assets, a permanent UK office and a native agent who looks into the business practices and spearheads all the activities. This help gets access to equity capital and knows about financing.