A SURE investment

Posted in Business Growth, Startup, Tax Saving
SURE Investment

SURE – Startup Refunds for Entrepreneurs is a tax relief incentive.

You may be entitled to an income tax refund of up to 41% of the capital that you invest in your own company under SURE. Depending on the size of your investment you may be entitled to a refund of income tax paid over the 6 years prior to the year in which you invest.

Main Conditions

The conditions for SURE are that an investor must:

  • Establish a new company carrying on a qualifying trading activity
  • Have mainly PAYE income in the previous 4 years
  • Take up full-time employment in the new company either as a director or an employee
  • Invest cash into the new company by way of purchase of new shares

Qualifying trading activity

Most trading activities are allowed subject to the exceptions below:

  • One-off or speculative transactions
  • Dealing in commodities or futures in shares, securities or other financial assets
  • Financing activities
  • Professional service companies
  • Dealing in or developing land
  • Film production

Investor Conditions

The investor must make an investment by purchasing new eligible shares held for a period of 4 years from the date of issue.

He must hold at least 15% of the issued share capital of the company for 12 months after the issue of shares, or if the company is not trading at that time, from the date it begins to trade.

The investor’s income from previous years must have been mainly liable to PAYE but income in the year immediately before the investment can be from any source.

He must enter full-time employment for 12 months with the company as an employee or a director starting either within the year in which the investment is made or if later, within 6 months of the date on which the share issue is made.

He must not receive any payments from the company other than reasonable remuneration and expenses in the 3 years after the share issue.

During the 12 months before the first investment in the company the investor must not have held (or have been entitled to acquire either directly or indirectly) more than 15% of the share capital, loan capital or voting rights of any other company.

This condition may be set aside where he held an interest in only one other company and either:

The company is dormant i.e. no turnover in any of the previous 3 years or

  1. The company had an annual turnover not exceeding €127,000 in each of the three accounting periods prior to the SURE investment and
  2. The other company mainly carried on a qualifying trading activity

The subscription for the shares must be for bona fide commercial purposes as you cannot use SURE just to avoid tax only.

Neither the investor nor the company may enter into any agreement, arrangement or understanding which could reasonably be considered to eliminate risk from the investment.

Company Conditions

The company must:

  • Be a qualifying new venture which means carrying on a qualifying trade, be a new company less than two years old and not have taken over an existing trade.
  • Be incorporated in Ireland or in another EEA State.
  • Be an unquoted company.
  • Be tax resident in Ireland or in another EEA State and carry on business in Ireland through a branch or agency.
  • Carry on relevant trading activities from a fixed place of business in Ireland.
  • Be a micro, small or medium-sized enterprise.
  • Have its issued share capital fully paid up.

Use the amounts invested:

  • for the creation and maintenance of employment and for the benefit of a qualifying new venture in the carrying out of relevant trading activities, and the creation and maintenance of employment or
  • in the case of a company that has not commenced to carry on relevant trading activities, on Research and Development (R&D) activities.

The company must not:

  • Have any special trading arrangements with the investor’s former employer company or a company related to that former employer company. Normal business transactions are acceptable provided they are conducted on an arms length basis.
  • Carry on a trade which is similar to any other trade in respect of which the investor has or had a controlling interest.
  • Control or be controlled by any other company, with the exception of controlling a qualifying subsidiary.

R&D Activities

Companies that have not commenced to trade may still qualify for SURE relief if they undertake relevant R&D activity provided:

  • They commence to trade within 2 years of the investment and expend all of the money subscribed for shares before the end of the 4 year holding period, or
  • They spend all the investment on R&D activities and dispose of a specified intangible asset within the meaning of Section 291A TCA 1997 (i.e. intellectual property or know-how) prior to a date which is one month before the end of the 4 year holding period for the shares

Eligible Investment

Shares must be new shares issued by the company. They may be redeemable shares which carry preferential rights on a winding up. There can be no other terms attaching to the shares or agreements made with the company or its shareholders which substantially reduce the risk that the investor will get their capital back or any expected dividend.

There can be two “relevant investments” under the scheme, the second of which must take place within two years from the end of the first year i.e. if the first relevant investment is in 2020, then the second investment must take place in either 2021 or 2022.

A relevant investment is the total invested in a calendar year e.g. an investor can make investments in March, June and December

Investment Limits

The minimum investment under the scheme is €250 and the maximum investment is €100,000 per year. Therefore the limit on the SURE investment is effectively €700,000, as €100,000 may be relieved in each of the previous 6 tax years and the current year.


If all of the conditions are met an investor may be entitled to a SURE refund on the investment as follows:

  • From the previous 6 tax years select the year the SURE investment is to be utilised.
  • The SURE investment is used to either:
  • to fully utilise the SURE investment, up to a maximum of €100,000, or
  • reduce the taxable income in the year selected to Nil.

If the SURE Investment has not been fully utilised in the year selected other years can be used in order to fully utilise the investment.

It should be noted that:

  • A SURE investment, up to a maximum of €100,000, must be fully utilised in the 1st year selected before another year is chosen and so on until the SURE investment has been fully utilised.
  • A SURE investment cannot be split between years in order to reduce income in a certain year to the standard rate cut off point and select another year in order to maximise the refund at the top rate of tax.
  • Only the investor is entitled to income tax relief on the SURE investment made.

You should always seek independent advice before you undertake a SURE investment.

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