An investing company subscribing for shares in an issuing company may claim investment relief providing certain conditions relating to both companies, and to the shares, are met. Relief is allowed against corporation tax at up to 20% of the amount subscribed.

Where investment relief is obtained, the investing company�s corporation tax liability for the accounting period in which the shares were issued is reduced by whichever is the smaller of either

• 20% of the amount subscribed for the shares, or

• the amount which reduces the liability to nil.


There is no minimum amount and no absolute limit on the amount of investment relief a company can obtain on subscriptions for shares of qualifying companies. But, the amount that may be invested in any one company is indirectly restricted by conditions relating to

• the size (in terms of asset value) of the issuing company following the investment, and

• the proportion of its share capital that can be owned by the investing company.


Although investment relief can be claimed once the shares have been issued, its retention is conditional on the shares being held by the investing company throughout the �qualification period� and on the other conditions of the CVS being met. Most of these conditions apply throughout the qualification period.


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