Income Tax Act 2007 section 257FB

Cases where maximum SEIS relief not obtained

Section 257FB adjusts the calculation of SEIS relief withdrawal on a disposal of shares where the investor did not obtain the full amount of SEIS income tax relief to which they were entitled.

• Where actual income tax relief obtained (A) is less than the full SEIS relief available (B), the amount subject to withdrawal on disposal is scaled down by the fraction A divided by B
• Where shares are treated as partly issued in a previous tax year, each part is treated as a separate share issue for the purposes of this adjustment
• If SEIS relief was reduced before it was obtained (for example, due to a prior event), the amount A is treated as what it would have been without that earlier reduction
• This restoration of A does not apply where the reduction arose from the attribution of SEIS relief following a corresponding issue of bonus shares