Treasury removes tax relief for community energy – how will this affect my investment?
Our Harborough Solar One community share offer is now open. An investment in the scheme is designed to be eligible for tax relief under the Seed Enterprise Investment Scheme (SEIS) and the Enterprise Investment Scheme (EIS). This means that a qualifying tax-payer could be eligible to claim up to 50% (SEIS) or 30% (EIS) back on the money invested.
The Treasury has announced that community energy projects will be excluded from the Enterprise Investment Scheme (EIS)/Seed Enterprise Investment Scheme (SEIS) from 30 November 2015. They have further stated that community energy schemes will be excluded from Social Investment Tax Relief (SITR), reversing the governments’ previous statement in March 2015.
These announcements mean that community energy organisations which benefit from subsidies for the generation of renewable energy will no longer be eligible for any tax-advantaged investment for investment made on or after 30 November 2015.
Share offers will need to be closed and shares issued by 30 November 2015 for investors to qualify for the relief – even where investments have received advance assurance.
With the share offer due to close in November there is every chance that the shares in Harborough Solar One will remain eligible for tax relief. Whilst the management of Harborough Solar One will seek to ensure that the project is run in compliance with SEIS and EIS rules, we cannot guarantee that the investment will be eligible for relief.
You investment is still projected to provide you with a 5% return excluding these reliefs.