UK specialist investment manager Oxford Capital has launched its second approved enterprise investment scheme fund.
UK specialist investment manager Oxford Capital has launched its second approved enterprise investment scheme fund.
The Oxford Gateway Approved Fund, which complements Oxford Capital’s existing unapproved EIS funds, will invest in a portfolio of high growth businesses from start-up to IPO in the healthcare, sustainability and communications sectors.
The approved status, granted by the HM Revenue and Customs, will enable investors to simplify their tax planning and enable them to claim income tax relief for the current 2008-09 tax year.
The approved EIS fund offers income tax relief and, to meet HMRC rules, 90 per cent of the subscribed capital will be invested within 12 months.
The unapproved EIS Fund provides income tax relief as each underlying portfolio investment is made and the fund will be fully invested within 18 months of subscription.
Both Oxford funds offer income tax relief, capital gains tax deferral, CGT exemption which allows tax free growth and 100 per cent inheritance tax relief.
Ted Mott, chief executive of Oxford Capital (pictured), says: ‘The ‘approved’ title is a bit of a misnomer as both our approved and unapproved EIS funds offer investors the potential for supergrowth returns from a portfolio of investments in the healthcare, sustainability and communications sectors. The difference is that our new fund has received HMRC approval in advance to enable investors to benefit from income tax relief in the tax year in which they subscribe to the fund.’
Both funds can also provide tax savings of 22 per cent on existing capital gains. Investors with gains crystallized in the last three years and liable to tax at 40 per cent can reinvest these gains into either Oxford Gateway Fund and defer the CGT to benefit from the new 18 per cent CGT ceiling.
Mott adds: ‘2009 is shaping up to be an exceptionally good time to invest in venture capital. Not only are valuations low but we can also negotiate better terms with companies, which can reduce risk and enhance returns. Over the next three to five years a number of factors are converging which I believe makes the current market the investment opportunity of a generation.
‘There’s no doubt that the cycle for technology replacement will pick up, led by products, services and solutions which reduce costs and boost productivity. This is true in all the fields in which we specialise and is a powerful demand driver. Acquisition pressure is also building in the big pharmaceutical and IT technology businesses which have deferred their own development work on new products. They will become increasingly motivated to acquire small specialist businesses which have both product and channels again providing the potential for excellent returns from our investments.’
Oxford Gateway Approved Fund is designed for private investors with a minimum investment of GBP25,000, up to a maximum of GBP2m and has a minimum holding period of three years if full tax advantages are to be captured.
