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Future Fund – A Glimmer of Light?12th May 2020 Corporate
A couple of weeks ago, we wrote a blog highlighting some issues with the Government’s Future Fund intended to support start-up businesses.
Today it has been reported that after pressure from the EIS industry, including the EIS Association and various funds and fundraisers, the Government may look again at the Future Fund rules.
The industry bodies are currently pushing for three key changes:
- Permitting EIS-qualifying investments to be qualifying co-investments for the purposes of accessing the Future Fund;
- Reducing the amount of funding required to have previously been raised from £250,000 to £100,000; and
- Increasing the amount of tax relief on EIS investments from 30% to 80%.
While it seems unlikely that the government will introduce as substantial an increase in the tax advantages of EIS, the other two proposals would allow many of the issues with the Future Fund to be addressed.
Hopefully the Government will update the rules shortly, so that the power of EIS investments can be unleashed to support the Future Fund and start-up and growth businesses generally. We will of course provide another update when they do.
JMW Solicitors LLP frequently advise on S/EIS issues and corporate fundraisings generally, including advising on structuring, advance assurances, fundraisings documents and applicable regulation. If you need any assistance in relation these or other legal issues relating to raising money for your business please contact please contact John Young of our London Office at email@example.com or 07849 628 755.
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This note is for general guidance only and should not be used for any other purpose. It does not constitute, and should not be relied upon as legal advice. It relates to the position in England only.
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This note is correct as of 11 May 2020