What is a BES Fund?
The Business Expansion Scheme is a Tax Relief incentive scheme which enables investors to deduct the cost of their qualifying investment from their total income for income tax purposes. It was established to encourage investment in small to medium sized private business operating in certain sectors. The scheme was extended in 2007 until 2013.
Why Invest in a BES fund?
- BES is one of the few sources of Total-Income-Relief available
- BES relief is available in full, in the year in which the investment is made.
- Funds are only committed for 5 years.
- The Investor’s exposure is limited to the up-front equity investment.
- The Investor does not need to have recurring tax exposure for a number of years.
- The increase to €2m per Investee Company allows more resources into structuring deals.
Why invest in the Simple.ie BES fund?
Business Venture Partners (BVP Ltd.) is an experienced BES Manager who has successfully raised and invested in three Simple.ie BES funds.
Why focus on Green Sector Investments?
BVP sees Green business as an emerging sector in the Irish economy and anticipate that it will become mainstream over the next few years. We define Green companies as those engaging in business with a focus on renewable energy, energy conservation or social responsibility. We also invest in energy efficiency, waste management or technologies connected with these sectors. The key drivers for growth include a combination of; industry wide environmental regulations and policies, as well as government incentives to facilitate change such as; grants, fixed premium rates for renewable energy suppliers (feed in tariffs) and upgrading the national grid.
What is the minimum or maximum I can invest?
An individual investor can obtain income tax relief on investments minimum of €5,000 and up to a maximum of €150,000 per annum in each tax year up to 2013.
How long is the term of the Investment?
The minimum investment period is five years from the date the fund invests in the respective companies.
How do I claim my tax relief?
For investmnts made in 2010 tax relief is claimed on investments for the year ended 31st December, 2010. It is the responsibility of the investor to make their own claim for tax relief on receipt of notification from the manager.
How much will my investment cost me?
Investors are liable to a commission of 4% of the full amount invested in the fund. There are no further charges.
How do I subscribe to the fund?
Our Prospectus, Information Memorandum and Application Forms are available on our website to be downloaded. These outline all relevant information and the terms and conditions for the Simple.ie fund.
We are now accepting applications for the 2010 fund. To subscribe to the fund, please (i) complete the Application Form and submit to BVP Investments Ltd., Simple.ie 2010 Fund, Unit 23, The Cubes 2, Beacon South Quarter, Sandyford, Dublin 18. (ii) completed application forms must be accompanied by a personal cheque or bank draft drawn on an applicant’s own bank account, payable to IFG Trust Company Limited a/c Simple.ie Green BES Fund. Please note the total amount must include the investment amount plus commission of 4%.
What is the term of my investment?
The minimum investment period is 5 years from the date the fund invests in the respective companies.
Who is the Manager of the fund?
The Fund is managed by BVP Investments Ltd. a private company established for the purpose of managing a Designated Investment Fund.
Who is the Trustee to the fund?
The fund has appointed IFG Trust Company Limited (‘IFG Trust’) as trustee of the fund. IFG Trust is a subsidiary of IFG Group Plc, the publicly quoted Dublin based financial services group.
What is the investment strategy for the fund?
The focus of the Fund is on capital appreciation through investment in ethically and ecologically oriented and socially sustainable companies. The manager will be seeking to invest in a number of companies with capable management and future growth potential.
The Key Criteria that the Manager will look for in assessing whether to invest in a potential Investee Company and its promoters are:
a recognized and proven market for Investee Company’s product;
demonstrated future growth potential;
a capable and industry experienced management team;
a market strategy which has been carefully articulated and thought out; and
the prospect for realization of investment after the five year BES period
The Manager will take all reasonable care and advice in selecting and assessing proposals for investment. In order to spread the commercial risk of the Fund, the Manager will seek to balance the portfolio of Investments across several industries.
There will be a balance between low risk, medium risk and higher risk investments which will include investment into Investee Companies at various stages of development. The objective is to ensure a spread of risk whilst providing opportunity for earning attractive returns for investors.
What are the risks associated with BES Investment?
Medium – Long term investment (5 years minimum), no early exit mechanism;
Investors are exposed to the performance of the companies in which the scheme will invest and investors may lose some/all of the capital invested;
Taxation relief may be withdrawn if certain conditions are not satisfied;
More details of risks attaching to this investment are set out in the Investor Memorandum.
What is the exit process for my Investment?
The Manager will co-ordinate the Exit of the Fund after expiration of the Minimum Investment Period by seeking to make arrangements with the Board of Directors of each of the Investee Companies for the realization of the Investee Companies for the realization of the Fund’s investments. These may include:
a sale of the shares on the Irish Stock Exchange or any other recognized securities market, if such share are listed;
an acquisition or take-over;
a private placing, e.g. a trade sale;
a repurchase or redemption by the Investee Company of its own shares;
a sale of the BES shareholdings to the promoters of the Investee companies;
the exercise of a call or put option at market value with the promoters of the Investee Companies; and/or;
any other method of realization which may, in the opinion of the Manager, be appropriate at that time.