On 30 December 2019, HMRC released some helpful guidance on Advance Subscription Agreements (ASAs) and the application of EIS/SEIS. In order to qualify for SEIS/EIS, any ASA must :
- not in effect be a loan
- must not function as an investment instrument that offers other benefits (such as investor protections)
- not permit the subscription monies to be refunded under any circumstances
- not be capable of being varied, cancelled, or assigned
- not bear interest
- have a longstop date (expected to be no more than 6 months)
It is also important to note that SEIS/EIS relief will only be available from the date of the share issue.
