(Source: Prohibition Partners)
Current strategy is to float MedicaleafTM on the Alternative Investment Market in approximately three years’ time when MedicaleafTM share values will have been given a further boost as a result of anticipated liberalization by HM Government of the UK licensing system for Medical Cannabis production and prescription in the UK although a merger with a quoted company cannot be ruled out and will give a speedier exit for investors wishing to do so.
By this time MedicaleafTM will have well-honed brands for both the Medical and Wellness segments of the market and a firm grip of the recognized UK and European Distribution Channels.
In brief, the Enterprise Investment Scheme (“EIS”) is a Government scheme that is designed to help eligible start-up companies raise finance by offering a range of tax reliefs for investors who subscribe for qualifying shares in qualifying companies.
There are five current EIS tax reliefs available to investors in companies qualifying under the EIS.
30% income tax relief on the amount invested provided that the shares are held for a minimum of three years. The maximum amount on which investors may obtain income tax relief can be withdrawn if the investor becomes a ‘Connected Person’ or the company ceases to be qualifying within three years of the share issues.
CGT exemption on capital gains realised on the disposal of an EIS investment, provided that the shares have been held for at least three years.
Unlimited capital gains tax (CGT) deferral providing the investment is made in the period beginning 12 months before and ending 3 years after the date of the disposal subject to CGT. (N.B deferral relief can only be used in lieu of CGT exemption).
Inheritance Tax (IHT) exemption providing the shares have been held at least two years from the date of issue and are held at the time of death.
Losses on the disposal of shares can be offset against either taxable income or chargeable gains on other assets.