EIS Investment Opportunities

GCV Invest operates on a deal-by-deal basis, so it isn’t a fund in the traditional sense. That said, investment in GCV itself does offer some of the characteristic signs of investing in a fund with exposure to multiple of our portfolio companies.

Many investors seek out venture capital firms that focus on deal-by-deal investing because it offers more freedom and control. A common piece of feedback from our investor network is that they enjoy building a portfolio over time, choosing which EIS opportunities to invest in as new ones are added to the platform.

To explore more of the benefits of investing deal-by-deal rather than through a fund, we’ve put together some content on the topic.

To claim tax reliefs from EIS investments, you can either speak to your accountant or complete the EIS3 form, which is issued to you shortly after the investment is made.

You can also claim via your Self-Assessment tax return. In some cases, you may need to amend a previous year's return to apply the relief to earlier income tax liabilities.

Capital Gains Tax (CGT) free profits are automatic - no claim process is required, as eligible gains are simply exempt.

For a more in-depth guide, we’ve created a resource covering how to claim EIS tax reliefs, including income tax relief, CGT deferral, inheritance tax relief, and more.

When signing up to GCV Invest, you'll go through a quick investor categorisation process - this is a requirement set by the Financial Conduct Authority (FCA) to ensure that all investors understand the risks involved with early-stage investing.

There are four FCA-recognised investor categories, and most individuals will qualify under one of them, such as a High Net Worth Individual or a Self-Certified Sophisticated Investor. The process is straightforward and typically takes just a few minutes.

Once categorised, you’ll see that the minimum investment for most GCV opportunities is £5,000. This threshold is clearly stated on each opportunity. At other venture builders or platforms, this minimum may vary (sometimes higher, sometimes lower) depending on the structure of the deal and platform policies.

EIS investments involve backing early-stage, often high-growth startups. As a result, returns are not guaranteed, and the risk is considered to be high.

That said, there are ways to manage and potentially reduce that risk. At GCV Invest and GCV Labs, we have a unique and close working relationship with many of the portfolio companies we support. This often includes hands-on help with business development, custom platform and website builds, and full multichannel marketing support. It’s this level of involvement that leads many, both internally and externally, to invest alongside others.

To help offset some of the risk, the government introduced the Enterprise Investment Scheme (EIS). By investing in EIS-eligible opportunities, investors can access a range of tax reliefs, including:

• 30% income tax relief

• Inheritance tax relief (after 2 years)

• Capital gains tax deferral relief

• Loss relief

In the unfortunate event that the company fails, income tax relief and loss relief can be combined, reducing your effective loss exposure to as little as 38.5% of the original investment.

We’ve created a dedicated guide on how EIS loss relief works if you’d like to explore this further.

And if you’d like to speak with us about the risks involved, we’d be happy to help. Simply submit a contact form and we’ll arrange a call.

Yes, HMRC's own guidance (helpsheet HS341) treats jointly held EIS shares as though each of you subscribed an equal amount for an identical number of shares, even if one of you funded the whole investment. Each joint holder needs their own EIS3 certificate from the company to make their individual claim, so it's worth confirming with the company or platform that certificates will be issued per person, not just to the lead investor on the application. In practice, most of our investors choose to make transactions separately, but often for the same amounts.