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EIS: new HMRC interpretation

HMRC have issued Brief 77/09, in which they set out a revised view on how the qualifying condition for Enterprise Investment Scheme (EIS) relief contained in ITA 2007, s. 183 (the issuing company to carry on the qualifying business activity requirement) should be applied.

HMRC consider that the relevant legislation at s. 183 has the effect of disqualifying a company where the relevant trade, preparation work or research and development, is carried on by the company in partnership or by a limited liability partnership of which the company is a member.

This view was originally set out in a technical note issued as a supplementary document to the 2009
Pre-Budget Report. The content of that note has now been republished as a Brief to correct a typographical error in the original text.

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About The Author

Sarah Laing
Editor, TaxationWeb News

Sarah is a Chartered Tax Adviser. She has been writing professionally since joining CCH Editions in 1998 as a Senior Technical Editor, contributing to a range of highly regarded publications including the British Tax Reporter, Taxes - The Weekly Tax News, the Red & Green legislation volumes, Hardman's, International Tax Agreements and many others. She became Publishing Manager for the tax and accounting portfolio in 2001 and later went on to help run CCH Seminars (including ABG Courses and Conferences).

Sarah originally worked for the Inland Revenue in Newbury and Swindon Tax Offices, before moving out into practice in 1991. She has worked for both small and Big 5 firms. She now works as a freelance author providing technical writing services for the tax and accountancy profession.

Article Added Friday, 08 January 2010

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