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Where Taxpayers and Advisers Meet

EIS Claim on company in Liquidation

mp2016
Posts:19
Joined:Sat Jan 02, 2016 1:14 pm
EIS Claim on company in Liquidation

Postby mp2016 » Wed May 22, 2024 8:58 am

Hello

Can anyone advise as to how I claim a EIS refund on. Company I invested in and has now gone into liquidation?

Do I require any documentation from the liquidator and do I have to wait until liquidation is complete ? Which could take a long time

What forms do I need to send and to which HMRC department/office?

Thanks in advance.

bd6759
Posts:4308
Joined:Sat Feb 01, 2014 3:26 pm

Re: EIS Claim on company in Liquidation

Postby bd6759 » Wed May 22, 2024 9:05 pm

What do you mean by EIS refund?

Jholm
Posts:383
Joined:Mon Mar 11, 2019 4:22 pm

Re: EIS Claim on company in Liquidation

Postby Jholm » Thu May 23, 2024 12:21 pm

It's probably more likely that you owe money back as a result of the company no loner trading (assuming not held 3y).

However, loss relief is likely available - take care with this, as it is not the same as many other loss relief claims.

bd6759
Posts:4308
Joined:Sat Feb 01, 2014 3:26 pm

Re: EIS Claim on company in Liquidation

Postby bd6759 » Thu May 23, 2024 10:36 pm

Liquidation doesn’t count as a disposal for EIS clawback.

mp2016
Posts:19
Joined:Sat Jan 02, 2016 1:14 pm

Re: EIS Claim on company in Liquidation

Postby mp2016 » Sat May 25, 2024 6:40 pm

Hi

Sorry, to clarify the company has/did trade for over 3 years and now has gone into liquidation. I claimed eis relief when I invested, and my understanding is that if the company failed (post 3 years) which it has I could claim loss relief?

mp2016
Posts:19
Joined:Sat Jan 02, 2016 1:14 pm

Re: EIS Claim on company in Liquidation

Postby mp2016 » Sat May 25, 2024 8:53 pm

It's probably more likely that you owe money back as a result of the company no loner trading (assuming not held 3y).

However, loss relief is likely available - take care with this, as it is not the same as many other loss relief claims.
Hi

Sorry, to clarify the company has/did trade for over 3 years and now has gone into liquidation. I claimed eis relief when I invested, and my understanding is that if the company failed (post 3 years) which it has I could claim loss relief?

bd6759
Posts:4308
Joined:Sat Feb 01, 2014 3:26 pm

Re: EIS Claim on company in Liquidation

Postby bd6759 » Sun May 26, 2024 4:46 pm

If the company is in liquidation and there is no prospect of a return to the shareholder you can make a claim under s24(1A) TCGA1992 that the shares have become of negligible value. If you make a claim, you are deemed to have disposed of the shares for zero, and immediately reacquainted them. The disposal means you have made a loss.

The deemed disposal occurs on a day of your choice, as long as the shares were worthless on that day. So you claim can be for a day before the claim is made.

The loss will be a qualifying loss for share loss relief. The loss is reduced by the amount of tax relief you claimed on acquisition. You can set the loss against your income in the of disposal or the preceding year.

bd6759
Posts:4308
Joined:Sat Feb 01, 2014 3:26 pm

Re: EIS Claim on company in Liquidation

Postby bd6759 » Sun May 26, 2024 4:52 pm

https://www.gov.uk/government/publications/negligible-value-claims-and-income-tax-losses-on-disposals-of-shares-you-have-subscribed-for-in-qualifying-trading-companies-hs286-self-assessment-he

mp2016
Posts:19
Joined:Sat Jan 02, 2016 1:14 pm

Re: EIS Claim on company in Liquidation

Postby mp2016 » Sun May 26, 2024 10:21 pm

https://www.gov.uk/government/publications/negligible-value-claims-and-income-tax-losses-on-disposals-of-shares-you-have-subscribed-for-in-qualifying-trading-companies-hs286-self-assessment-he
Thank you so much, one final question , if I am employed, and don't do a self assessment, how do I claim the loss relief? Any particular form and department I need to send to?

Thx

bd6759
Posts:4308
Joined:Sat Feb 01, 2014 3:26 pm

Re: EIS Claim on company in Liquidation

Postby bd6759 » Mon May 27, 2024 11:35 pm

There is no form.

The NV claim must give sufficient information to identify the asset: full company name and reg number.

The capital loss claim simply quantifies the loss: cost less amount realised (nil), less EIS relief given.

The share loss claim states the year in which the relief is to be given. Remember the £50k max.


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