“I had heard about social impact investing but didn’t know how I could get involved. The introduction of SITR meant I could make a social impact investment through a tax efficient structure. With the help of my financial planners, I was able to deploy capital into this innovative investment product which is addressing a cause that seems to me really worthwhile.”

Mike Davies, an individual investor into FC United of Manchester

Social Investment Tax Relief (SITR) is a tax incentive for individuals making an investment into an eligible charity or social enterprise. It is modelled on the existing Enterprise Investment Scheme (EIS). 

SITR may enable you to claim personal tax reliefs which include income tax relief up to 30% of the amount you invest, capital gains tax-free disposal and hold-over relief. You can find more information about how it works and the different reliefs you can benefit from under SITR in our factsheet.

Is SITR for me?
Are you eligible
Are you eligible?

Individual investors

  • must not invest as part of a tax avoidance scheme
  • must not own more than 30% or have a material interest in the social enterprise or charity
  • must not become an employee, trustee or director of the social enterprise or charity. The organisation must also not be one where you or your relatives have a direct relationship.
Kinds of investment
Kinds of investment

There are two main kinds of investment an investor can make:

  • Loan
  • Shares
£1m
How much can you invest?

The maximum amount an individual can invest using SITR is £1m. There is no minimum amount.

Comparison to other forms of investment
Comparison to other forms of investment

You can see how SITR compares to EIS, SEIS and VCT in our factsheet.

How does SITR work?
Risk is offset
Risk is offset

30% of the amount invested is deducted from the investor’s income tax liability for the year in which the investment is made. For example, if an investor lends £1000 to a social enterprise, the real cost to the investor is £700.

signpost
What ways can I invest using SITR?

There are three ways an individual can invest using SITR:

  • SITR fund
  • Crowdfunding platform
  • Directly with the social enterprise or charity
Time
How long is the investment for?
  • The investment must be held for a minimum of three years.
  • SITR applies immediately from the point of the investment.
Info
Other key information to know
  • Both the investor and the investee organisation must be eligible for SITR throughout the period of the investment.
  • The investee organisation will need to provide the investor with a compliance certificate, which the investor can use to evidence their entitlement to claim SITR.
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