Enterprise Investment Scheme Subscription Application Letter for Shares

EIS shares must be subscribed for, meaning they must be newly issued shares and not shares sold by an existing shareholder.

The subscription for shares under the Enterprise Investment Scheme will require a degree of formality and it is therefore usual for the parties to enter into a subscription agreement.

However, for some smaller companies or investors who want to make a speedy investment, it may be more appropriate to use an application letter as an alternative.

Use this letter to apply to subscribe for EIS shares

This subscription letter is an application from the proposed investor(s) to the issuing company.

It does not include the terms or level of detail that would be expected in a subscription agreement, but it sets out the basic terms of the subscription.

What the letter covers

• The number of shares to be subscribed for
• The subscription price to be paid
• That the shares are proposed to qualify for EIS tax relief
• Authority to add the subscriber’s name to the company’s register of members once the subscription monies have been paid and received

HMRC and the EIS1 compliance statement

HMRC requires sight of the subscription or shareholders agreement (if there is one) when the company completes its EIS1 compliance statement.

This is likely to include sight of a subscription application letter in place of a subscription agreement.

Independent advice

It is strongly recommended that independent legal and tax advice is sought for companies or investors considering EIS investment.

Enterprise Investment Scheme Subscription Application Letter for Shares is part of Corporate. Just £38.50 + VAT provides unlimited downloads from Corporate for 1 year.