EIS Changes Create Opportunities

Following last week’s UK budget announcement regarding Enterprise Investment Schemes (EIS) we have had a lot of interest from high net worths who see this as a potentially interesting way of mitigating the 50% marginal tax rate. The new rules permitting companies with gross assets of up to £15m and up to 250 employees to raise up to £10m per annum will broaden the spectrum of suitable companies and more importantly bring development stage companies with good management and some tangible assets increasingly into the frame. We are looking at how we can structure a suitable product for investors which will allow them to utilize the annual limit (£400k) but spread their risk over a number of different investments. The regulations still require parliamentary approval and won’t come into effect until 2012 but we will keep you posted.