Capital Gains Deferment

Capital Gains Deferment

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Client has placed money into a 12 month investment, expects a 200% gain on their money - I know, they have only been in touch after the investment was made; so fingers crossed!

Assuming they make the gain, lets call it £50k for illustration. They would be liable for CGT on this, after deduction of their allowance.

Should they then place this gain into an SEIS or EIS, would they still be able to defer the liability?

It sounds plausible to me, as it's a similar investment; over to the CGT experts please.

Regards,

Anth

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By mhtax
13th Jan 2014 19:08

SEIS

has more implications than you imply.

If he makes an SEIS investment of £50,000 he will receive up to £25,000 income tax relief (limited to tax paid if relevant).

He will also be entitled to defer a gain of up to £50,000 if he invests £100,000 during 2013/14. This relief has only been extended to April 2014 so far so it may well not be there when your client realises his gain.

The best I could advise a client ro 'rely' on would be that he should be able to invest to secure an income tax refund which would cancel out the cash flow effect of paying capital gains tax.Some providers are offering a fund investment made up of a range of SEIS  investments n the same way a Unit Trust spreads the risk.

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