EIS: income tax relief: company and investor procedures: investor claims: method of
Relief for a year should normally be claimed on the tax return for that year. Where, however, the tax return has already been made and a claim, or an additional claim, falls to be made, the return should be either amended or, if it is too late to amend it, supplemented by a ‘stand-alone’ claim, preferably made using the claim section of form EIS3 (or the form EIS5 if the investment is made through an Approved Investment Fund).
A claim does not become final, and relief is not finally obtained, until the tax return on which it is made ceases to be capable of amendment. Where for any reason relief which is claimed would, if it had been obtained, have had to be withdrawn, the individual ceases to be eligible for relief - see ITA07/S257(4) - and the tax return needs to be amended accordingly.
When a claim is made on a SA tax return the required details in respect of each holding of shares should be copied from the form EIS3 into the space reserved at the end of the form for further information. As regards the processing of a return which includes a claim, see the SA Manual (Business Area, Returns, Section, Individuals, Subject, Claims to relief for EIS).
Investors who wish to obtain relief for an investment for the current year without waiting for the year to end can effectively do so by requesting a change to their code number (using the claim section of form EIS3 or form EIS5) or by claiming a reduction in a payment on account.
In no circumstances can a claim be made, or a coding adjustment made, or a payment on account reduced, before the investor has received form EIS3 or form EIS5. Forms EIS3 can only be obtained from the company issuing the shares, and are only supplied to a company submitted a satisfactory statement on form EIS1 in respect of the share issue in question. Form EIS5 can only be obtained from a fund manager to certify receipt by the manager of form EIS3.
As regards the procedure where the investor wants to treat some of the shares as issued in the year before the year in which they were issued see VCM14170.