Is company legally obliged to provide EIS3?

My client made an HMRC approved EIS investment but is having difficulty obtaining the EIS3

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My client made a qualifying EIS investment in good faith.  HMRC approved the EIS application and issued forms EIS2 and EIS3 to the company.  The company appears to have lost the original forms.  Duplicates were obtained from HMRC including a blank EIS3 for completion by the company.  The company is now refusing to complete the form on the grounds that the directors 'do not feel qualified' to complete it.  The amount of tax relief potentially at stake is substantial.  What are my client's rights and how should she proceed?

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By cathygrimmer
08th Oct 2018 10:49

The company always completes the EIS3 - not HMRC. The EIS2 authorises the company to complete the EIS3s. I doubt your client can compel them to issue an EIS3 - though there may be some legal claim for a loss if she invested because they told her relief was available and they would undertake the EIS procedure. If the amount of tax is substantial but the directors aren't comfortable about completing the EIS3 (though it is pretty simple!), they could appoint someone else to complete them - and the investor(s) could pay the fees. Maybe you could offer to do it?

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By bernard michael
08th Oct 2018 11:22

Will the directors explain "not qualified"

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Replying to bernard michael:
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By WaldoLydecker
08th Oct 2018 12:12

Thanks for your responses.

I have tried to be as helpful as possible and in fact have filled out the form as far as the questions asked are questions of fact. But it needs to be signed by an officer of the company (or a person authorised by the company) and the company is refusing to take responsibility. I don't feel I can sign the form as the agent of the investor!

With respect to the directors claiming to be unqualified they are saying that they do not have enough experience to be willing to sign the form. Part of the problem may be that the company has changed advisors twice since the original application for EIS was made.

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Replying to WaldoLydecker:
RLI
By lionofludesch
08th Oct 2018 12:16

They need to sign the form or give the lass her money back.

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Replying to WaldoLydecker:
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By cathygrimmer
08th Oct 2018 12:58

If they have advisers, surely they can confirm it is OK to sign the form (or can sign it on the company's behalf if authorised by the directors). Maybe if she threatens to sue the company for compensation for her loss they will change their minds! It does seem very strange that they took her money and applied for the EIS2 and then got cold feet. Is there more to this than meet the eye. If the advisers have changed, are they, perhaps, saying that the application wasn't valid for some reason?

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RLI
By lionofludesch
08th Oct 2018 12:02

Directors are often "not qualified" to do stuff.

They should buy in that expertise.

If the client has made the investment on the promise that EIS relief would be available, she has a claim for compensation. Without som detail, it's hard to say against whom that claim might be.

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