EIS tax relief AND loss relief in the same return?
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Posts: 2 Newbie
in Cutting tax
Hello! I've made an investment in EIS-complient company in 2018. The company could not produce EIS3 certificate in time for January 2019 deadline, so I did not claim any relief then. It did send me an EIS3 this year, but already went through scheme of arrangement process and my equity was wiped out as part of that. My investment was 5,000 GBP, to make this example easier.
I'm claiming EIS tax relief (30% of 5,000 = 1,500). I have all information for that in EIS3.
Value of this investment was wiped out as a result of the scheme of arrangement, so I need to make a Negligible Value Claim. I'm in 40% tax bracket, so I need to claim (5,000 - 1,500) = 3,500 (loss taking into account EIS relief that I'm claiming in the same return), 3,500 * 40% = 1,400, or a total of 2,900. I have a court order describing the scheme of arrangement to prove that the value was wiped out.
My questions are the following:
1. Can I claim both types of relief as part of one self-assessment return?
2. If so, I need to fill in SA108. Do I need to provide any additional calculations on top of that?
3. What evidence for my negligible value claim I need to provide to HMRC and how can I do so>
Thank you for your help
I'm claiming EIS tax relief (30% of 5,000 = 1,500). I have all information for that in EIS3.
Value of this investment was wiped out as a result of the scheme of arrangement, so I need to make a Negligible Value Claim. I'm in 40% tax bracket, so I need to claim (5,000 - 1,500) = 3,500 (loss taking into account EIS relief that I'm claiming in the same return), 3,500 * 40% = 1,400, or a total of 2,900. I have a court order describing the scheme of arrangement to prove that the value was wiped out.
My questions are the following:
1. Can I claim both types of relief as part of one self-assessment return?
2. If so, I need to fill in SA108. Do I need to provide any additional calculations on top of that?
3. What evidence for my negligible value claim I need to provide to HMRC and how can I do so>
Thank you for your help
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Comments
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Good questions, quite tricky to give an authoritative answer without first hand experience (or working at HMRC). I believe you can do (1) yes. Re (2) and (3), it seems the info you provide in the post, plus the court order as evidence, should be plenty sufficient for the tax return. That's my take.0
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mostwelcome wrote: »Good questions, quite tricky to give an authoritative answer without first hand experience (or working at HMRC). I believe you can do (1) yes. Re (2) and (3), it seems the info you provide in the post, plus the court order as evidence, should be plenty sufficient for the tax return. That's my take.
Thank you for your comment.
How do I actually attach the court order? It is a 100-page pdf.0
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