Income Tax Act 2007 section 197

Excluded activities: hotels and comparable establishments

Section 197 clarifies when running a hotel or similar accommodation business counts as an excluded activity for the purposes of the Enterprise Investment Scheme.

• A "comparable establishment" means a guest house, hostel, or other establishment whose main purpose is providing overnight accommodation, with or without catering services.
• Running a hotel or comparable establishment is an excluded activity under the EIS rules, meaning it generally cannot qualify for EIS tax relief.
• A person's activities are only caught by this exclusion if they own, have an interest in, or occupy the hotel or comparable establishment in question.
• Simply providing services to a hotel without having an ownership interest or occupation does not trigger the exclusion.