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Social investment tax relief (SITR)

Quick facts

Social investment tax relief (SITR) is a government scheme that incentivises private investment in social enterprises (i.e. businesses that generate a positive social impact). The rules for both investor and social enterprise are similar to those for Enterprise Investment Scheme (EIS).

The government introduced Social investment tax relief (SITR) in 2014. At the time, private individuals investing risk capital into early-stage mainstream businesses were already benefiting from the EIS and SEIS schemes, so SITR was seen as a way of levelling the playing field for social enterprises. The government defines social enterprises for SITR purposes as:

  • community interest companies
  • registered charities
  • community benefit societies.

In line with the eligibility rules for EIS, your business might be eligible for a SITR investment (along with advice and support) if:

  • you will use money for a ‘qualifying trade’
  • you have no more than £15m in gross assets
  • you have no more than 250 employees.

The maximum amount of investment allowed the lifetime of your enterprise is £1.5m. Any investments under SITR will also count towards limits on further investments through government venture capital schemes (i.e. EIS, SEIS and VCT).

The tax reliefs for individual investors are similar to those available via the Enterprise Investment Scheme (EIS) and include income tax relief (30% of the value of the investment up to £1m total investment per tax year.

You can find more information on the HMRC website under SITR.

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