As time may be running out for SITR, we take a brief look at what it is and how investors can benefit.

What is SITR?
Social investment tax relief, or SITR, is the UK government's tax relief for social investment, which encourages individuals to support social enterprises and helps them access new sources of finance. Investors can claim up to 30% income tax relief on their investments.

When can I claim SITR on investments?
If you make a qualifying investment into a social enterprise or charity, your investment could qualify for SITR, providing you meet the eligibility criteria. However, the current government SITR allowance looks set to be withdrawn at the end of the 2020-21 tax year in April, so any investments to benefit from it should be made before that date.

How does SITR benefit investors?
If you make a qualifying investment in a social enterprise, including a charity, Social Investment Tax Relief (SITR) can:
  • give you a reduction of 30% of that investment in your income tax bill for that year
  • let you defer a Capital Gains Tax charge if you reinvest the profits into a social enterprise
  • after 3 years, let you sell or give away SITR-qualifying investments that have gained in value without paying Capital Gains Tax.*
How does SITR benefit social enterprises
Social enterprises often need to raise funding in order to grow. SITR is an added incentive for investors to choose to fund these enterprises, meaning tax relief for them and affordable funding for social enterprises. Watch this short video form Big Society Capital on how SITR can benefit social enterprises.

*Information from the UK government website

Investments offered on the Ethex platform are not readily realisable, which means that they may be difficult to sell and you may get back less than you originally invested. Investments are not covered by the Financial Services Compensation Scheme (FSCS) and returns are not guaranteed. If you are in any doubt, you should contact an Independent Financial Adviser.

Investments offered on the Ethex platform are not readily realisable, which means that they may be difficult to sell and you may get back less than you originally invested. Investments are not covered by the Financial Services Compensation Scheme (FSCS) and returns are not guaranteed. If you are in any doubt, you should contact an Independent Financial Adviser.