Q&As

Do shares need to carry voting rights in order to qualify for relief under the seed enterprise investment scheme?

read titleRead full title
Published on LexisPSL on 05/01/2018

The following Tax Q&A provides comprehensive and up to date legal information covering:

  • Do shares need to carry voting rights in order to qualify for relief under the seed enterprise investment scheme?

Do shares need to carry voting rights in order to qualify for relief under the seed enterprise investment scheme?

As set out in Practice Note: SEIS—conditions for relief: issued shares, the funds raised and arrangements in general, the shares issued to the individual investor seeking seed enterprise investment scheme (SEIS) relief must be 'ordinary shares'.

This is defined in section 257CA of the Income Tax Act 2007 (ITA 2007) as shares forming part of a company's 'ordinary share capital'.

Ordinary share capital is itself defined in ITA 2007, s 989 as all issued share capital, by whatever name called, other than capital the holders of which have a right to a dividend at a fixed rate but no other right to share in profits. This is the same definition used for corporation tax purposes, for example in the context of whether a company forms part of a group for group loss relief purposes.

There are no statutory references determining whether a share must have voting rights in order to qualify as ordinary share capital, as defined for the purposes of SEIS

Popular documents