VCM31300 - EIS disposal relief: part-disposal:
example
- July 1996 an investor subscribes
£100,000 for 100,000 shares in an EIS company. Income Tax
relief of £20,000 is given in 1996-97 as the lower rate of tax
is 20%.
- January 2000 the investor sells 25,000
shares for £10,000. Income Tax relief of £2,000 is
withdrawn, (£10,000 x 20%), see VCM26070 example 2. Income Tax
relief of £3,000 attributable to the shares sold is not
withdrawn. The allowable loss is calculated as below.
| Disposal proceeds | | £10,000 |
| Less cost | £25,000 | |
| Reduced by Income Tax
relief* | £3,000 | £22,000 |
| Allowable loss | | £(12,000) |
*This is the EIS Income Tax relief not withdrawn which remains
attributable to the shares sold.
