Calculus, a leading provider of tax efficient investments, last week announced the launch of its new HMRC-approved Knowledge Intensive Enterprise Investment Scheme (EIS) Fund.
The offering, which follows the UK government’s renewed endorsement of EIS in the mini budget having lifted the 2025 sunset clause, will give investors the opportunity to support early-stage innovative UK companies with a societal purpose and impact with at least 80% of the fund’s capital invested into businesses carrying out research and development to create new intellectual property.
The Enterprise Investment Scheme (EIS) is designed to help smaller, higher risk trading companies raise finance by offering 30% income tax relief, unlimited tax-free capital gains and full inheritance tax relief to investors who purchase new shares in those companies. Since launching in 1994, the EIS has helped 34,335 companies receive investment and over £25 billion of funds have been raised.
Closing on 5th April 2023, the fund will aim to return £2 tax free for every £1 invested, over an investment horizon of four to seven years. The fund offers a portfolio of at least six companies and has a minimum investment of £25,000. The launch follows a strong 2021 in which Calculus made eight profitable exits, returning over £50m.
John Glencross, Chief Executive and Co-Founder of Calculus, explained: “Calculus has been investing in knowledge intensive companies as part of its investment strategy since launching the first HMRC approved EIS fund in 1999. Since then, it has built a long-standing reputation for profitable exits for investors. This approved fund will not only enable easier tax planning, but will give purposeful investors the opportunity to grow their own wealth and give meaningful support to a new generation of UK companies driving the digital revolution forward and improving healthcare.”
Investors can take advantage of this HMRC-approved fund to claim income tax relief at up to 30%, unlimited tax-free capital gains, capital gains tax deferral relief, loss relief, and full inheritance tax relief. An advantage of being an approved fund is that investors can claim income tax relief in the tax year the fund closes, or carry it back to the previous tax year.
By contrast, investors in ordinary, unapproved EIS funds must claim their tax relief at the point that the fund invests in the underlying companies, which may cross multiple tax years and be more challenging for tax planning.
Focus on technology and healthcare companies
The Calculus Knowledge Intensive EIS Fund focusses on technology and healthcare companies – two of the UK’s fastest growing sectors. It allows investors to support companies underpinned by the exciting investment landscape offered by the UK’s strong presence of research universities, robust government support, and thriving M&A market. The UK’s technology sector leads the European market, having raised double the amount of VC funding of any other country in 2022. Meanwhile, the healthcare sector has, in recent years, been a world leader in fighting pandemics and advancing patient care.
Calculus’ current portfolio of pioneering Knowledge Intensive companies includes: Oxford BioTherapeutics, a clinical stage oncology company; Hinterview, the only video platform designed exclusively for recruitment agencies allowing users to increase their net fee income and speed up deal cycles; and Arecor, a globally focused biopharmaceutical company revolutionising treatments for diabetics.
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