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HMRC internal manual

Venture Capital Schemes Manual

Share Loss Relief: how to use the guidance: do the shares qualify for other reliefs or investment incentives?

Throughout its history, Share Loss Relief has been amended from time to time to ensure its provisions are consistent with other reliefs and incentives available to investors in business. Examples are the Business Expansion Scheme (BES), the Enterprise Investment Scheme (EIS) and (for corporate investors) investment relief under the Corporate Venturing Scheme. Where these other reliefs are or were only available in respect of shares issued at certain times, the Share Loss Relief rules applicable to a particular claim involving shares issued at those times will recognise the possibility that the other reliefs may be due. The conditions for each relief are different and where more than one relief is due, care should be taken to identify the applicable conditions.

For instance, where a holding contains shares in respect of which BES relief has been given and not withdrawn, or EIS or deferral or investment reliefs are attributable, the normal share identification rules for Share Loss Relief at section 576(1) cannot apply and alternative rules are used. This is dealt with under ‘mixed holdings’ later in this guidance (see VCM75440+).

BES relief was available in respect of certain shares issued before 1 January 1994

EIS and reinvestment reliefs are available in respect of certain shares issued on or after 1 January 1994.

Investment relief (for investing companies) is available in respect of certain shares issued on or after 1 April 2000 and before 1 April 2010.

SEIS income tax relief and capital gains re-investment relief are available in respect of certain shares issued on or after 6 April 2012.