EIS scheme tax relief: does it also apply to dividend taxes?

[Investor]

The Enterprise Investment Scheme (EIS) states that tax relief of 30% can be claimed on investments, up to £1,000,000 in one tax year, giving a maximum tax reduction in any one year of £300,000, provided you have sufficient Income Tax liability to cover it.

Does this income tax relief also apply to dividend taxes payable on dividend income from shares in companies please?

Thank you.

[PinkDalek]

.. Does this income tax relief also apply to dividend taxes payable on dividend income from shares in companies please?

The applicable tax rates on dividends may be computed differently to other rates but it is still Income Tax, so why not?

I can't say why not but https://www.gov.uk/guidance/venture-capital-schemes-tax-relief-for-investors suggests not.

Better direct link if it works https://www.gov.uk/guidance/venture-capital-schemes-tax-relief-for-investors#income-tax-relief

[eisman]

PinkDalek wrote:

The applicable tax rates on dividends may be computed differently to other rates but it is still Income Tax, so why not?

That is correct - income tax payable on dividends received is indeed income tax against which relief for qualifying EIS (or Seed EIS) investment can be given.

The HMRC guidance he then refers to puts a different point in clumsy terms: "Tax relief on income from dividends? (Answer: No)
This merely indicates that dividends received from EIS companies are not tax-free (unlike dividends from VCTs).