Tax Efficient

Some of the highlights from our recent EIS Masterclass held at DWF’s offices in the iconic ‘walkie-talkie’ building. The event covered the political outlook for EIS, due diligence, suitability, research into the correct level of diversification, analysis of the fees charged by EIS funds and insights into how managers put together and run their portfolios.

Matt talks about the driving forces behind increasing levels of adviser engagement in EIS and how the industry is responding. He also addresses the issue of supply of product, and why advisers shouldn’t be waiting for the “new renewables” to come along. We also talk about whether there are any emerging risks to the EIS scheme, and finally Matt talks about the differences between EIS funds and portfolio services.

Philip gives us a unique take on how politicians view the EIS scheme and discusses the levels of awareness of the scheme among small businesses. We consider how his research indicates that there is the potential for more growth in EIS and the importance of lobbying efforts at a national and European level. Finally, we talk about what his research means for advisers and how advisers should consider it.

Henny Dovland talks about TIME Investment’s new EIS offering in Dry Bulk Shipping. She discusses why this sector is a non-contentious fit with EIS, and why this is crucial in the light of the recent regulatory changes. Henny also covers why TIME think that now is the right time to invest in shipping and takes us through some of the other features of the product, including the asset backed nature of the investment and how that gives assurance around opportunities to exit. We also examine exactly how the underlying assets earn revenues, and what the best-case, worst-case and base-case returns to investors are likely to be. Finally, we cover the fee structure of the product and how the charges have been structured to allow the maximum amount of tax relief.

In this in-depth interview, Robert takes us through the five step process an EIS manager typically goes through to put together, run and eventually exit a portfolio of EIS investments. He covers sourcing deal flow, selecting opportunities, structuring deals, ongoing management and finally (and most importantly!) exiting investments. We discuss the numbers involved, the challenges encountered at each step and how EIS managers overcome them. Finally, we get his opinion on the future of the EIS scheme in the light of the recent changes to the legislation governing the scheme.

Andrew Sherlock talks about the different ways that advisers can diversify an EIS portfolio between growth and capital preservation strategies; between vintages; and between companies and cycles. He also explains how the income tax relief and loss relief puts a limit on losses, and how that works in a portfolio strategy.

Andrew Marris covers fees in EIS and why they are higher than mainstream investments, and harder for advisers to assess. He tells us what advisers can do to dig a little deeper to fully understand the fee structures and why the fees are set up that way. We also cover the advantages and disadvantages of charging investee companies rather than investors.