The additional benefits of EIS and VCT investing

17.03.2020
Sarah Edmunds
Financial Planning

You will often hear about the effectiveness of EIS and VCT investing in terms of Income Tax relief, Capital Gains Tax deferral and Inheritance Tax exemptions but what about the less tangible benefits of investing in this type of product?

You will often hear about the effectiveness of EIS and VCT investing in terms of Income Tax relief, Capital Gains Tax deferral and Inheritance Tax exemptions but what about the less tangible benefits of investing in this type of product?

I am of course talking about the work being undertaken by some of the companies typically funded by EIS investing. These are smaller companies, often working at the forefront of new technology, which can make a real difference in ordinary people’s lives.


Take for example the Hero Arm, made by Open Bionics. Open Bionics have developed the worlds first clinically approved, 3D printed bionic arm. You may have seen some of their work showcased on TV at various stages throughout its development but it is now proving very successful with funding approved for a veteran through the NHS Veterans’ Prosthetics Panel. After more than ten years after his accident during active duty in Helmand Province, ‘Daz’ is now able to complete the vast majority of everyday two handed tasks with far greater ease than when using other prosthetics. For more information on the project please see https://openbionics.com/daz/

A, less exciting perhaps, but certainly just as important project funded by EIS is a smart hot water tank company run by two Oxford University PhD students. Hot water tanks have become a fixture in many a UK home but they are terribly inefficient, often consuming as much energy each year as a small car. Mixergy’s vision is to develop a better tank which saves customers energy whilst also facilitating the uptake of intermittent renewable generation. If rolled out across the UK, their technology would save almost 11GWh of energy per day, equivalent to the typical output of a 1GW power station. In a changing world increasingly looking to reduce carbon emissions, energy efficiency is just as important as reducing use where possible. For more information on the project please see https://www.mixergy.co.uk/


Other examples include:

eLucid mHealth – a medication technology company creating automatic monitoring tools using smartphone and smart packaging technology.

Hand Hygiene Solutions Ltd – developing an automated software solution with the aim to improve the collection of hand hygiene compliance data integrated with user feedback to influence behaviour change.

Firefly – a suite of school learning tools used in 40 countries. It has the potential to cut school administration by 50% and connect teachers, parents and students directly both in and out of the classroom.

There are of course many more interesting investment opportunities available through EIS and VCTs. 

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