Why invest with Grass Roots Films?

Grass Roots Films was launched in January 2005 with the specific purpose of financing and producing a world class animation feature film for the international and domestic market. The aim is to encourage investment in the production of the film "Grass Roots" by means of public offerings of shares under the Government's Enterprise Investment Scheme (EIS) ,

The tax incentives available through the Enterprise Investment Scheme (EIS) often act as the initial attraction for potential investors, Equally important though is the opportunity for the investor to paricipate in realising the international financial potential of the Fabulous Furry Freak Brothers in their first feature film "Grass Roots".

What tax reliefs are available through the EIS scheme?

There are several types of tax relief available:

a) Income Tax Relief

b) Capital Gains Tax Exemption

c) Capital Gains Tax Deferral

d) Loss Relief

e) Inheritance Tax Relief

Can I invest as an overseas investor?

Yes, but the various EIS tax reliefs may not be available. Please contact Tania Seymour or Will Cogley at the Matrix Model Group for more information on +44 (0)1173 101 348.

How do I obtain the tax relief?

In the first few months after subscribing for your EIS shares you will be sent a tax certificate. This needs to be sent to your tax office. If you receive it after the end of the tax year then send it with your tax return.

How much tax can I save or defer when I invest?

Types of Relief	Amount Invested	Tax Relief	Net Cost to you
i) Investors claiming EIS tax relief	£10,000	£2,000	£8,000
ii) Investors claiming CGT deferral relief	£10,000	£4,000 (repayable when the investment is realised or ceases to qualify)	£6,000
iii) Investors claiming both EIS income tax relief and CGT deferral	£10,000	£2,000 (income tax relief) £4,000 CGT deferral (repayable when the investment is realised or ceases to quality)	£4,000

Eligible investors may therefore be able to combine the above reliefs so as to achieve initial offset of 60p in the £1.

  Examples (ii) and (iii) are calculated on the assumption that you would otherwise pay tax at 40% on the chargeable gain.

How much can I benefit from this relief?

Types of Relief	Max. Rate	Max. Annual Investment	Max. Tax Savings
EIS income tax relief	20%	£400,000 single person £800,000 couple	£80,000 (single) £160,000 (couple)
EIS Capital gains relief	40%	No specific upper limit,but the lower of the gain to be deferred the amount subscribed	No upper limit

Is there any limit on the value of EIS shares I can buy in any one tax year?

Yes. The new annual limit (as of April 2006) is £400,000 per individual in each tax year. As a couple the limit is therefore £800,000 (However, there is no such limit on CGT Deferral Relief)

What would happen if I were to sell my shares after 3 years at a profit?

You will not have to pay tax at all on any profits made from the sale of your Shares if you sell them after three years.

What would happen if I were to actually lose money after 3 years?

EIS Loss relief effectively limits the downside to 48% of the original investment. (Calculation assumes higher rate of tax)

Where can I get advice?

EIS Investment is a specialised area of UK taxation and you should obtain the correct advice. You should contact an Accountant or Independent Financial Adviser who is experienced in this field. Click on this link to find an IFA near to you www.ukifadirectory.co.uk

LEGAL DISCLAIMER

  The investments featured on this website may not be suitable for all recipients or be appropriate for their personal circumstances. If in any doubt a potential investor should seek advice from a qualified independent financial adviser. Contact details of Independent Financial Advisers can be found on www.mylocaladviser.co.uk .

  The information on this website is believed to be correct but cannot be guaranteed.

  Opinions constitute our judgement as of this date and are subject to change without warning.

  Past performance is not necessarily indicative of future performance and the value of investments may fall as well as rise and the income from them may fluctuate and is not guaranteed.

  Investors may not recover the amount invested.

  Some investments carry a higher degree of risk than others.

  The levels and basis of taxation can change.

  It must be understood that neither this website nor associated websites offer or provide tax, legal or financial advice. All material found on this website and associated websites pertaining to tax, legal or financial matters is for information purposes only.

  None of the material featured within this website or associated websites shall be construed as any kind of investment advice or offer or solicitation to invest in any of the investments described within this website or associated websites. It must therefore be understood that all references to investing and investment within this website and associated websites are for information purposes only.