Filling the gap

Retirement income planning for high net worth savers became a bit more complicated after 5 April 2011  when the tax relief on pension contributions was reduced from £255,000 to £50,000. One option to fill the gap is the Enterprise Investment Scheme (EIS), which offers generous tax reliefs for investment in early and growth stage businesses. Savers can invest up to £500,000 in the current tax year, rising to £1m in 2012/13, and benefit from 30% income tax relief. EIS also offers CGT deferral relief, tax free gains and IHT relief after an investment has been held for two years. Inves...