Having run several webinars in collaboration with the Plunkett Foundation, Crowdfunder, Power to Change and the Community Shares Unit Scotland we kept hearing that one of the trickier parts of using SITR comes post investment. That is when it comes to actually claiming the relief.
This seems to a particular barrier for Community Benefit Societies when raising investment using Community Shares probably because of the sheer number of individual investors this might involve.
This of course got us thinking, if this is a barrier to using SITR …
- How can we help the organisations raising SITR to make sure they complete all the steps to enable their investors to claim the relief and
- How do we help investors understand what actions they personally need to do in order that they receive the tax repayment.
New resources
Our mission at Get SITR is to provide social enterprises, charities, investors and advisers with access to free support and resources to better understand and use Social Investment Tax Relief.
Together with Mills & Reeve LLP, we are pleased to publish two new guides:
These easy to follow practical resources set out the process for claiming the 30% income tax relief from HMRC once the SITR investment has been made.
We hope they will prove valuable in assisting organisations working with their investors to claim the tax relief – enabling them to see the whole process, what is required at each stage and getting organised so that key deadlines are not missed. We hope in particular that the investor guide will be a tool that Community Benefit Societies will be able to email, issue or point their investors to help manage any enquiries and therefore their workload.
Key stages
Detailed in the guides are four key stages:
1. The social enterprise that raised the SITR funding must submit a compliance statement (form SITR1) to HMRC
2. HMRC will (assuming they are happy with the form submitted) issue the social enterprise with:
- A letter (SITR2) to the social enterprise confirming that SITR will be available to investors, and
- A compliance certificate (SITR3) for each investor
3. The social enterprise will need to:
- Complete a certificate for each investor, and
- Send the certificates to the investors
4. Finally, each investor must then claim their own tax relief.
The complementary guides include a visual step-by-step process as an easy reference tool so that each party understands what they need to do and by when. Where available, examples of the forms that require completion are also included and there are direct links to the relevant HMRC webpages.
Infographic for Social Enterprises:
Infographic for Investors:
If you’ve used the guide/s, please do let us have your feedback and suggestions on other ways we can help you Get SITR.
About Mills & Reeve LLP
Mills & Reeve is a top-50 full service UK law firm with offices in six cities across England. We have teams of specialists offering support for charities, social enterprises and public sector clients, with particular expertise in the healthcare and education sectors.
With six offices nationally, over 120 of our lawyers work for our charity and social enterprise clients, including specialist teams in charity law, philanthropy and contested legacies, and alternative fundraising.
Neil Pearson, partner at Mills & Reeve, has been closely involved over recent years in the introduction and development of Social Investment Tax Relief, which has helped social enterprises to raise £m's of much-needed funding. Neil continues to work in promoting the tax relief to widen its take-up by UK social enterprises.