HomeInsightsGuidesSocial Investment Tax Relief


Social Investment Tax Relief

In April 2014 the UK introduced a social investment tax relief (SITR), which is intended to make the UK one of the easiest places in the world to invest in social enterprises.

In general terms, social enterprises are businesses that trade for social good or public benefit, and often undertake projects in the local community. They make up about 7% of the SME population and exist in a range of sectors such as employment, healthcare and sport and leisure.

These businesses often face a funding shortage, and SITR provides a tax incentive to help bridge this gap. Here are some of the headline features for individual investors:

  • Maximum investment per individual will be £1 million in each tax year
  • Minimum investment period of three years
  • 30% income tax relief and exemption from capital gains tax

The relief will be available for private investment into qualifying social sector organisations: charities, community interest companies and community benefit societies. The social enterprises must have fewer than 500 employees and less than £15 million gross assets.

As a means of attracting investment, SITR creates a more level playing field for social enterprises when compared with other small companies. The table below compares the headline position of the three main tax advantaged schemes for investors.

Read the extended tax relive help sheet here.

Print Friendly, PDF & Email

  • Manufacturing funding new product development or capital investment

    With the increasing pace of technological change and the challenges posed by Brexit it has never been more important for businesses to differentiate themselves from competitors to enable their business to thrive. This may be achieved by developing new products, investing in technology to drive efficiency, investing in customer relationships or exploring new markets. The […]

    Print Friendly, PDF & Email
  • Revised FRS 102 Reduces Intangible Asset Recognition Requirements

    FRS 102 Revisions Revisions to FRS 102 arising from within the Financial Reporting Exposure Draft 67 (“FRED 67”) will see acquiring companies in business combinations being given the option to recognise fewer intangible assets than they had been required to previously. These revisions are being implemented by the Financial Reporting Council (“FRC”) in response to […]

    Print Friendly, PDF & Email
  • FRS-102 Technical Update – February 2018

    In March 2017 the FRC published FRED 67 which contained amendments to FRS 102. These were finalised on the 14 December 2017 and can now be early adopted. If a company chooses to early apply FRED 67 all amendments must be adopted. The effective date is for periods beginning on or after 1 January 2019. […]

    Print Friendly, PDF & Email