EIS Advanced Assurance Letter to HMRC
It is possible (and most likely advisable) for the issuing company to ask HMRC if the proposed share issue is likely to qualify for EIS tax relief before the EIS shares are issued. This is called advanced assurance. This form of cover letter may be used to accompany the advanced assurance application.
Only companies intending to issue shares can apply for advanced assurance. It is not possible for individuals considering investing to apply and therefore advanced assurance only relates to whether it is expected that the company will be a qualifying company and the shares will be eligible shares; it does NOT confirm whether any individual shareholder is eligible for relief.
HMRC has further details on advanced assurance here, and has an application form EIS-SEIS(AA) which can be used to apply directly online for advanced assurance.
It is not compulsory to use this form, particularly if there are special circumstances which the company may feel it needs to explain. The company may send a letter to HMRC outlining its application. This is therefore the form of cover letter that may accompany the advanced assurance application only if the above form is not being used.
It is strongly recommended that independent legal and tax advice is sought for companies or investors considering EIS investment.
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