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HMRC internal manual

Venture Capital Schemes Manual

EIS: income tax relief: general requirements: overview

ITA07/S172

As well as the investor requirements (see VCM11000+) and issuing company requirements (see VCM13000+) there are general requirements relating to the investment and how it is used. Chapter 3 of ITA07/Part 5 sets out the requirements to be met as to:

  • the shares (see VCM12020),
  • the maximum amount raised annually (see VCM12030),
  • the spending of any previously raised SEIS money (see VCM12040)
  • the purpose of the issue of shares (see VCM12050),
  • the use of the money raised (see VCM12060) (see VCM12110 for the meaning of ‘qualifying business activity’),
  • the minimum period (see VCM12070),
  • no pre-arranged exits (see VCM12080),
  • no tax avoidance (see VCM12090), and
  • no disqualifying arrangements (see VCM12100).