EIIS Fund Launch – How Legal Professionals Can Benefit

By: Kevin Canning | Posted on: 25 Nov 2022


Unincorporated professionals have always suffered unfairly high tax liabilities, none more so than legal professionals who cannot incorporate. This is evidenced by professionals paying 55c of every €1 earned in income taxes. To make matters worse, the income tax payment is due annually by 31st October before the professional finishes their financial year. This creates a cash flow timing issue.

There are only two ways to lower this tax liability, namely:

·         Penson Contributions; or

·         EIIS Investing

Most professionals will know all about pension contributions and their limits. However, few have knowledge of how beneficial the EIIS scheme can be. Even with maximum pension contributions, the average professional still has an excessive tax liability.

The EIIS scheme allows for professionals to invest in established Irish SMEs with excellent management teams while availing of up to 40% income tax relief. A €50k investment in an EIIS scheme results in a €20k reduction in your income tax liability. This can be taken directly off a professional’s annual income tax liability which is due before the financial year ends.

Worked Example

Let’s assume a practice has two partners making €500k per annum in profit (i.e. €250k per person). The take home pay for each person should be circa €130k (i.e. €120k in tax). This €120k tax liability is due by 31st October before the income is fully earned for that year. This prepayment of income tax can be reduced by an EIIS investment.

A €50k investment could reduce the income tax liability from €120k to €100k, thus the investment has a net cost of €30k with no negative cash flow timing issues. Based on a 4 year coupon of 20%, the professional could return €60k in 4 years time (from a net cost of €30k) with the potential for a larger windfall depending on the structure of the investment.

Benefits of EIIS Investing

EIIS investing is most beneficial to professionals who are unincorporated, however, the uptake of professionals utilising EIIS is quite low. At Quintas we would love to change this.

Benefits to EIIS Investing for professionals:

·         Reduced tax liability – 40% of your investment is offset against your tax liability

·         Alternative to pension contributions – you may have fully maxed out your pension contributions

·         Fixed return in 4 years, great for retirement planning

·         No cash flow timing issues for tax relief (can come off income tax liability)

·         Defined exit mechanism in 4 years

·         Support innovative Irish SMEs with great management teams

Quintas EIIS Fund

Quintas recently relaunched our EIIS Fund, The EIIS Innovation Fund. The Fund will invest in 4 to 5 established Irish SMEs allowing investors to benefit from 40% tax relief while also diversifying across a number of industries and companies.

With experience in operating EIIS/BES investments since 2005, The EIIS Innovation Fund will be managed by Quintas Wealth Management Limited (QWM) and advised by Quintas Capital Limited and Quintas Partners. The fund will be led by Quintas Capital Director, Kevin Canning. 

Find out more: Key Features Document 

Quintas Approach

We take EIIS investing very seriously and take every measure possible to reduce the risk associated with each investment. Some of these measures include:

·         Governance – we play an active role in the company and insist on great corporate governance, this includes assisting with building out an experienced board of directors

·         Monitoring – we receive monthly management accounts and do quarterly meetings with the founders. We also assist companies to build excellent monthly reporting with the relevant KPIs.

·         Investor Reporting – we insist on quarterly updates to investors from each portfolio company

·         Restricted Salaries – we restrict founder salaries until such time as the company can afford an increase

·         Company Covenants – we restrict any transactions that are harmful to our investment such as taking on additional debt, founders exiting companies, etc.

If you would like to learn more, please reach out to Kevin Canning (Kevin.canning@quintas.ie)


Warning: The value of your investment may go down as well as up. Investors may lose some or all of the amount invested. There is no guarantee that the Fund will meet its target objectives. 

Quintas Wealth Management Limited is regulated by the Central Bank of Ireland.