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community investment tax relief

Community Investment Tax Relief (CITR) is available to UK individuals and companies that invest in accredited intermediary organisations (Community Development Finance Institutions or CDFIs), which in turn invest in enterprises operating within or for disadvantaged communities.

The tax relief reduces the investor's income liable to income tax or corporation tax by up to 25 per cent of the sum invested, spread over five years. To obtain maximum relief investors must hold the investment for at least five years, but if in the course of that period they receive some return of the sum invested they will not necessarily forfeit the relief in full. Reasonable commercial payments of interest and dividends are permitted.

There is no limit to the amount of investment on which a single investor may claim relief under the scheme. However, there are limits on the amount of investment that can be raised by any single CDFI. [1]

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