Page 27 - Kavka Proposal Web

Gross Assets 3. Inheritance Tax
The gross assets of the Company must not exceed An inheritance tax liability on the estate of a deceased
£15 million immediately before the issue of EIS person, or on the transfer of assets by way of a lifetime
Qualifying Shares and £16 million immediately gift, may be reduced or eliminated to the extent that
afterwards. the assets comprise “Relevant Business Property”
The Trade (as defined in IHTA). For this purpose, “Relevant
Business Property” includes shares where the
The trade must be a qualifying trade and must not company concerned is unlisted and is either a trading
have been carried on for more than seven years at the company or the holding company of a trading group.
time of the first EIS investment, and must have fewer
than 250 full-time employees. To obtain the relief, the shares must have been owned
during the previous two years or must have been
(c) Withdrawal of EIS Relief inherited from a spouse or civil partner and, when the
If the Company ceases to carry on its Qualifying spouse’s or civil partner’s period of ownership is taken
Trade before the end of the EIS Qualifying Period, EIS into account, the combined period of ownership must
Relief obtained by the Shareholders of the Company be at least two years.
may be withdrawn. EIS Relief will also be wholly or 4. Stamp Duty
partially withdrawn if, for example, the Shareholder
receives value from the Company (dividends which No stamp duty or stamp duty reserve tax will be
do not exceed a normal return on investment do not payable on the issue of share certificates relating to
constitute a receipt of value for this purpose), or if EIS Qualifying Shares. No stamp duty or stamp duty
he/she disposes of the EIS Qualifying Shares during reserve tax will be payable on the registration of the
the EIS Qualifying Period in relation to those EIS original holders of EIS Qualifying Shares. Stamp duty
Qualifying Shares (a transfer of EIS Qualifying Shares will be payable by a purchaser on any disposal of EIS
between spouses is not deemed to be a disposal for Qualifying Shares by the original Shareholders.
these purposes). EIS Relief will also be withdrawn if
a Shareholder takes out a loan under special terms
connected in any way with the subscription for EIS
Qualifying Shares.
Any person who is in doubt as to his/her taxation
position, or is subject to taxation in a jurisdiction other
than the UK, should consult an appropriately qualified
professional adviser without delay.

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