Income Tax Act 2007 section 162

Overview of Chapter

Section 162 sets out the four requirements that an individual must satisfy in order to be treated as a qualifying investor for the purposes of the Enterprise Investment Scheme.

• The investor must have no connection with the company issuing the shares, such as being an employee, director or substantial shareholder.
• The investor must not have any linked loans — that is, loans that would not have been made, or would not have been made on the same terms, were it not for the share subscription.
• The investor must meet the existing shareholdings requirement, which restricts relief where the investor already holds shares in the issuing company.
• The investment must not be part of arrangements whose main purpose, or one of whose main purposes, is the avoidance of tax.