A company limited by guarantee was controlled by the company issuing shares for enterprise investment scheme purposes and was a subsidiary of the issuing company but not a qualifying subsidiary.
The appellant was incorporated in February 2015 as the parent company of a group. It owned 100% of the shares in a company (HPG), which in turn owned 100% of the shares in another company (HFL). In April 2015, the appellant issued shares to investors, which it was hoped would qualify for enterprise investment scheme (EIS) relief.
On 1 May 2015, HFL acquired the entire shareholding of GNF. At the same time, HFL became the sole member of GNMA, a company limited by guarantee (which was a vehicle for holding client funds and had no intrinsic value of its own). On 6 May 2015, the appellant issued further shares to investors, which it again hoped would qualify for EIS relief.
The appellant submitted forms EIS1 to
