Income Tax Act 2007 section 186

The gross assets requirement

Section 186 sets out the limits on the gross value of a company's assets immediately before and after a share issue that qualifies under the Enterprise Investment Scheme.

• For a single company, gross assets must not exceed £15 million immediately before the relevant share issue and £16 million immediately afterwards.
• For a parent company, the same £15 million and £16 million limits apply, but they are measured against the total gross assets of the whole group.
• When calculating group assets, any intra-group items such as rights against, shares in, or securities of another group member are excluded to avoid double counting.
• The "relevant share issue" means the entire issue of shares that includes the EIS-qualifying shares, not just the qualifying shares themselves.