My client mande a SEIS investment in June 18. it was a standalone (A) with associated company (B) i.e. the sort of 'group' that we've all had that isn't actually a group.
In the next month-or-so, there will be a group restructure. A&B will each own 25% of newco D. The remaining 75% will be owned by individuals. A&B will hive their trade down to D. So now my client's investment is in a holdco that owns 25% of a 1-company trading group. Some of the money raised in A's funding round hasn't yet been spent.
"It must either exist to carry on a qualifying trade or else be the parent company of a trading group ... A trading group is a group in which, directly or indirectly, more than 50% of the shares of each subsidiary are held by another member of the group, but any subsidiary employing any of the money raised by the issue of shares must be a qualifying 90% subsidiary."
I think that the investment will lose it's SEIS status, unless A spends the rest of the money before the restructure. Am I right?