Doubling of EIS tax relief limits announced in this week’s budget would likely impact a very limited group of investors, with only 150 individuals using the full existing limit of £1m in 2015/2016.
Government data published last month shows that figure was slightly down from previous years. In 2014/2015 and 2013/2014 160 and 195 individuals respectively reached the £1m limit.
This week Chancellor Philip Hammond said the Government would be doubling the limit to £2m for knowledge-intensive companies.
Despite the small numbers of individual investors benefiting from tax relief in the last financial year, the group collectively invested £140.5m into EIS qualifying companies.
Growthdeck head of business Gary Robins says attracting significant new monies into EIS qualifying companies is a challenge, and the industry needs increased investor awareness or enhanced incentives, such as increasing income tax relief.
Robins adds: “While doubling EIS investment limits for knowledge intensive companies is welcome news, we would have liked to have seen similar support for the many other non-tech growth companies.”
In total 33,000 applied for EIS income tax relief of 30 per cent.