A new fund is being launched under the Enterprise Investment Scheme (EIS), planning to secure tax breaks for its investors by backing growing companies.
A new fund is being launched under the Enterprise Investment Scheme (EIS), planning to secure tax breaks for its investors by backing growing companies.
HG Tech Fund is being launched by Highgate Associates, which was co-founded by Andrew Muir and Ken Nelson in 2001, and Enterprise Corporate Finance, an investment adviser whose principal Susan Phillips is director general of the EIS Association.
Says Phillips, ‘It is not just about spotting a winning technology but understanding its market and, above all, working with the management to get ahead of the competition.’
The fund will take no profits for itself until it has delivered an annualised return of at least 6 per cent to its investors. It aims ‘to be fully invested as quickly as possible so that investors can claim their EIS tax relief promptly’, and is looking to deliver returns ‘within a three to five year investment window’. The initial close of HG Tech Fund will be on 4 April.
EIS funds offer a range of tax reliefs including a 20 per cent income tax rebate on investors’ money and exemption from capital gains tax and inheritance tax under certain conditions. They may invest in companies with gross assets of up to £7 million and fewer than 50 employees.
