Tax Benefits

Investing in the shares of smaller companies can carry significant tax benefits.

INHERITANCE TAX RELIEF

Investments in certain classes of shares can qualify for Business Property Relief.

Under s.184 of the FinanceAct 1996 100% relief is available on investments that are: Not listed on a recognised stock exchange – i.e. private equity; or have been admitted to trading on the Alternative Investment Market (AIM).

However, there are conditions and exceptions to this rule.

There is a minimum qualifying ownership period of two years prior to transfer, and investments in businesses or companies that engage wholly or mainly in dealing in securities, stocks or shares, land or buildings, or in making or holding investments are excluded.

CAPITAL GAINS TAX (CGT)

With effect from 6 April 2008, gains are taxed at a flat rate of 18% and are no longer taxed by reference to income tax rates and bands.

A new Entrepreneur’s Capital Gains Tax relief has been introduced, with effect from 6 April 2008, which only applies to individuals holding at least 5 % of the shares in a company and being a director or employee of the company.

Some of the companies we recommend may be eligible for Capital Gains Tax relief under the VCT and EIS schemes. Our investment advisors will tell you if either of the schemes applies to an investment being recommended by Mansion House Securities and further details will be contained in the appropriate offer document.

Tax legislation does of course change from time to time. Mansion House Securities does not hold itself out as a tax advisor and, should you require information or assistance in relation to the tax implications of an investment, you should obtain independent expert advice.