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Where Taxpayers and Advisers Meet

Claiming returned EIS cash as Business Relief

davidxt
Posts:34
Joined:Mon Feb 23, 2015 4:00 pm
Claiming returned EIS cash as Business Relief

Postby davidxt » Wed May 04, 2022 8:34 am

In completing an IHT400, I come across the following. The deceased was in the process of receiving cash from the sale of an investment in an EIS company. The company had existed for over 5 years. The company was sold in order to return funds to the shareholders.

Repayment of the sale proceeds to shareholders was being made in tranches, the final one being unpaid at the time of death. The investor had intended, when all proceeds had been received, to reinvest them in another EIS vehicle believing that the new investment would be entitled to business relief from the outset. However he did not live long enough to do so and the partial proceeds remained as cash in the estate valuation.

Can anyone help as to whether the cash proceeds (partially in the estate and partially still awaited) can be entered in the IHT400 as a claim for Business Relief?

AGoodman
Posts:1738
Joined:Fri May 16, 2014 3:47 pm

Re: Claiming returned EIS cash as Business Relief

Postby AGoodman » Wed May 04, 2022 12:12 pm

No, the cash isn't subject to BPR - intent to invest doesn't get you there.

The expected cash may not count either but that will depend on the exact situation. If the shares have been sold under a binding contract for sale, neither the shares or the sum due from them will qualify for relief.

davidxt
Posts:34
Joined:Mon Feb 23, 2015 4:00 pm

Re: Claiming returned EIS cash as Business Relief

Postby davidxt » Wed May 04, 2022 3:27 pm

Many thanks for your help.


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