Investment Reliefs
| Annual investment limits | 2017/18 | 2016/17 |
|---|---|---|
| Individual Savings Account (ISA) | ||
| – Overall limit | £20,000 | £15,240 |
| – Lifetime ISA (LISA) | 4,000 | N/A |
| Enterprise Investment Scheme (EIS) | 1,000,000 | 1,000,000 |
| Seed EIS (SEIS) | 100,000 | 100,000 |
| Venture Capital Trust (VCT) | 200,000 | 200,000 |
| Social Investment Tax Relief (SITR) | 1,000,000 | 1,000,000 |
Notes
- ISA investors can invest in any combination of cash or shares up to the overall limits shown.
- The Lifetime ISA (LISA) is introduced for 2017/18. Taxpayers aged between 18 and 40 may open an account and invest up to £4,000 each year, which qualifies for a 25% Government bonus on amounts invested up to the age of 50.
- This benefit is retained as long as the money is either
- put towards a first home costing up to £450,000, or
- kept in the account until reaching age 60, or
- withdrawn after being diagnosed with a terminal illness.
- If the money is withdrawn in other circumstances, the bonus will be clawed back with an additional 5% charge. The £4,000 is part of the general ISA limit of £20,000, not additional to it.
- Junior ISA is available to UK residents aged under 18 and who don’t have a Child Trust Fund account. When the holder reaches age 18, their junior ISA becomes an adult ISA.
- EIS, VCT and SITR investments made within the limits shown attract 30% Income Tax relief, but those schemes all have different qualifying rules.
- SEIS investments attract 50% Income Tax relief.
- Where the disposal proceeds from any capital gain are reinvested under EIS or SITR in the four-year period that starts one year before the date of the gain, all or part of the original gain can be deferred.
- Gains reinvested under SEIS, within the same timeframe as for EIS, up to the investment limit attract 50% exemption from CGT.
- Investments made under EIS, SEIS and SITR can be carried back to be treated as made in the previous tax year, subject to the investment limits.
- Disposals of investments acquired under EIS, SEIS, SITR or VCT are exempt from CGT if investment conditions have not been broken.
