Deadline day for BES funds

SEVERAL BES project managers will be in their offices today to take bookings from investors in their schemes, before the deadline runs out this evening.

All the major BES funds are full, but some stand alone projects will remain open for the day. The fact that the last day for availing of the scheme - if investors wish to get their tax relief back in a lump sum this year - falls on a bank holiday made matters a little more complicated for the small projects.

It is believed that the final tally will be around £60 million, virtually the same as last year.

Only one major fund, the Ailesbury Fund, remained open yesterday. The fund, which originally sought to raise £10-£15 million, lowered its target to £6 million. It was being managed by Cormac Crawford & Associates in association with Irish Pensions Trust and MMI stockbrokers.

Mr Kevin O'Shaughnessy, of MMI, said the fund would close yesterday evening or today and it was near the £6 million mark at that stage. The fund has earmarked projects in the food, technology, tourism and aviation sectors.

Under the BES scheme, individuals can invest up to £25,000 and qualify for full income tax relief on income earned in the 48 per cent tax bracket. Therefore, someone at the 48 per cent rate could claw back up to £12,000, plus their investment and more, depending on whether their initial investment appreciated.

Bowen & Associates, which was handling a number of stand alone projects, said most were closed. One was a cheese project which was "just about closed" yesterday.

Irish Fencing, which is seeking to raise £250,000, was around £20,000 short last night and will be open today. The company's owner/manager, Mr Terry Hobdell, former chairman of the Irish Small and Medium Enterprises' Association, will be taking bookings today. The fund will be proceeding anyway.

Bloomsbury, the Dublin gift and partyware manufacturer, will also be open today. It has raised £160,000 of its £200,000 target and will be proceeding anyway. The company said it was very pleased with the fund raising to date.

BES promoters say that the major funds raise about two thirds of BES money, while smaller projects account for about one third each year.

Not all of the smaller projects will raise enough to proceed as planned. Industry sources said one city based hostel project had abandoned its fund raising yesterday, but the hostel could not be contacted to confirm this.

Although the deadline has expired, the fund managers work has not finished. Not all money collected has been earmarked for projects. Fund managers said that this year, there was no problem collecting money; finding enough suitable ventures in which to invest was another matter.

It is for this reason that most funds decided not to raise additional funds once their initial targets had been met.

Fund managers said investor confidence and a buoyant economy, combined with a lack of tax shelters, had made BES schemes even more popular with investors this year.

The first fund to fill up was the ICC fund which reached its £5 million target from existing investors without even being publicly advertised. It had to increase its fund to £8 million.

The Second Davy Select Fund, managed by Davy and BDO Simpson Xavier with the Bank of Ireland, had to raise its initial fund target of £5 million to £10 million. It was filled two weeks ago.