Par Equity have announced the launch of their ‘Knowledge-intensive EIS fund.
The Par Knowledge-Intensive EIS Fund will invest alongside the Par EIS Fund, providing underlying investors with EIS reliefs as applicable, whilst also providing further potential benefits.
Firstly, as an HMRC approved Fund, it will give investors improved tax planning as the relief is tied to the date of the Fund’s close (5th April) rather than when the underlying investments are made. This provides investors with much greater certainty of claiming EIS relief against the current tax year or by carrying it back to the previous tax year, i.e., the 2021/2022 tax year.
Secondly, there is a single EIS5 certificate produced once the Fund is fully deployed, rather than multiple EIS3 certificates for each underlying company. Par Equity has a target deployment of 15 months after the Fund close, but it’s worth adding that HMRC requires that 90% of the Fund be deployed within 2 years.
Thirdly, investors can invest a maximum of £2m per tax year in qualifying knowledge-intensive companies, double the threshold for EIS-qualifying companies that are not knowledge-intensive.
The launch of the Fund follows a successful 2022, which saw Par Equity invested £38m in early-stage technology businesses across the North of the UK, up from £25m in 2021, making it one of the most prominent and active technology investors in the region. The venture capital firm backed 27 companies in 2022, of which ten were new additions to the portfolio.
Paul Munn, Managing Partner at Par Equity commented: “EIS firmly remains the backbone to early-stage technology investing across the UK, spurring jobs and innovation. We are delighted to be launching this new Fund in response to market demand. Crucially, our successful investment strategy, forged over the last 15 years, remains unchanged, but our investors can now benefit from an alternative option for tax planning purposes.
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