Many of you will have read the growing number of articles causing panic and confusion within the EIS and Entertainment industries of late (Click here to read Screen Daily’s report). The recent press coverage speculating on the future of EIS/SEIS and Film has rocked the already precarious boat of film investment.
Making films is already an expensive and almighty task to accomplish, made even more difficult due to the perception of film as an investment class. We know about this perception all too well at Goldfinch and have heard many horror stories in our three and a half years of trading. But what is evident and incredibly positive is that investors DO want to invest in this asset class and we see it as our duty to advise and protect their interests and money, starting with the simple things like ensuring the EIS vehicle has a qualifying trade and is commercially viable.
HMRC’s apparent backtracking in this space is perhaps a knee jerk reaction to their dealings with some of the well known characters within our industry. However they should be careful to protect the baby from being thrown out with the bathwater, and to ensure that entrepreneurs can still invest through plain vanilla SEIS and EIS into relevant businesses in the Film (and media) space.
Weeding out the chaff of ‘proper’ businesses with real risk is a non sequitur as far as EIS and SEIS is concerned – but to deny an entire asset class a helping hand in encouraging investors to be involved in the early stages of their trading is simply crazy, and will ensure that the entire sector will forever be unable to shake off the ‘film scheme’ reputation and memories it has begun to emerge from.
Here at Goldfinch HQ we rigorously vet all projects to ensure the businesses and projects are both viable and commercial to stand the best chance of turning a profit in a difficult international marketplace. To deny these reliefs is foolhardy and unnecessary and will harm an industry that supplies so much to our GDP and keeps us not only as one of the top global destinations for film makers, but is recognised as a centre of excellence for the Independent film makers. HMRC should be extending the reliefs of EIS and SEIS for those that pass more stringent tests in ALL asset classes, singling out film as the offender is wrong on so many levels.