Enterprise Investment Scheme (EIS) deferral relief enables an individual to reinvest gains arising on the disposal of assets into shares in a qualifying company. When the new EIS shares are sold the deferred gain comes back into charge.
Historically any Entreprenuers’ Relief (ER) that would have been available on the original gain has not been available, on the subsequent event of the deferred gain, coming back into charge.
However by virtue of an announcement within the Autumn Statement, with effect from 3 December 2014, gains eligible for ER, which are deferred into investments that qualify for the EIS or Social Investment Tax Relief (SITR), will benefit from full ER when the gain comes back into charge.
Consequently ER will not be lost as a result of investing in shares that qualify for EIS or SITR.