Company Conditions

For a company to qualify for EIS it must fulfil the following criteria:

 

  • Must be unquoted (AIM and plus markets excluded).
  • Must not control or be controlled by another company that itself is not EIS qualifying.
  • The company issuing the shares under the EIS must have a permanent establishment in the UK.
  • There must be no disqualifying arrangements in existence, i.e. broadly tax avoidance arrangements, and the company must not be in financial difficulty when shares are issued.
  • Must not have gross assets valued at over £15 million immediately before the share issue, and £16 million immediately after the issue.
  • Must not have 250 or more full-time employees.
  • Must be carrying on a qualifying trade. It is sufficient for a company to have qualifying subsidiary(ies) to carry on a qualifying trade and for the parent company to make loans to its subsidiaries. The business of precision engineering will constitute a qualifying trade.