Alan Pink looks at some specific situations where clients should carefully plan the structure of their investment in businesses.
The subject matter of this article is the structuring of business investments made by those who are not directly involved in carrying on that business. It considers the planning issues that arise from the point of view of maximising relief in the event of that investment being lost if things go badly wrong.
The principles involved will be brought out in a series of hypothetical examples.
Example 1: Buy or subscribe?
A has agreed to put £100,000 into Z Ltd, a trading company whose trade counts as a ‘qualifying trade’ for enterprise investment scheme (EIS) purposes. At the same time as this investment is made, one of
