Income Tax Act 2007 section 172

Overview of Chapter

Section 172 provides a roadmap of the general requirements that shares must satisfy under the Enterprise Investment Scheme (EIS) in order for the investor to qualify for income tax relief.

• The section acts as an index to the chapter, listing each general requirement that the relevant shares must meet for EIS purposes.
• Requirements cover the nature of the shares themselves, caps on annual and cumulative risk finance investments, the purpose of the share issue, and how the money raised is used.
• There are conditions relating to the permitted maximum age of the company, a minimum holding period for the shares, and a prohibition on pre-arranged exits.
• Anti-avoidance provisions require that the investment is not made as part of a tax avoidance scheme and that no disqualifying arrangements are in place.