Clean energy firm flags little known loophole for taxpayers

Hydrogen Solutions Ltd, which is in the process of relocating its UK headquarters to Bristol, says investment away from traditional growth sectors such as property and into new and emerging companies could mean huge tax relief benefits, thanks to the UK Government-backed initiative, The Enterprise Investment Scheme (EIS) and significant profitability due to their industry leading technology.

James Busche, CEO at the innovative global energy company, said: “The EIS scheme isn’t widely publicised, but it could be the key to unlocking substantial tax savings and capital gains, particularly for higher-rate taxpayers.

The American entrepreneur is developing a new electrolyser that produces hydrogen at a cost similar to diesel. He has already raised hundreds of thousands of pounds in finance for his venture as investors discover the benefits of EIS.

He said that UK investors looking to diversify their investments should be considering early-stage businesses, which offer tax relief benefits as well as supporting these businesses in their infancy.

The EIS scheme was introduced in 1994 to stimulate investment in startup business and in turn provide tax benefits to investors, such as income tax relief, capital gains tax exemption, and loss relief, thereby encouraging private investment in early-stage companies.

Strict rules are in place to establish which firms are eligible to issue full ordinary shares. These rules apply at the time of investment and at least three years afterwards to ensure investors are eligible to claim tax relief.

The scheme is designed to help smaller, emerging firms raise funds and as such, should be considered as a longer-term investment. Investors should be mindful that, as with all investments, there is always a risk to the investors’ capital.

However, under the scheme, companies must meet the risk-to-capital conditions such as aiming to grow and develop trade long term and not relying on continued investor support.

James said: “We have great ambitions to grow our business and develop key technology for the hydrogen energy sector. Investors getting on board with Hydrogen Solutions Ltd now would make them eligible for the benefits of the scheme as well as being part of our goal to transition to net zero.”

He said: "We have already raised a substantial sum from our first share issue and in a relatively short time. Investors have recognised the potential and worth of our business both financially and environmentally and are keen to get on board in the early stages, especially in view of the tax benefits available to them in the business's early years.”

Following this initial investment round, Hydrogen Solutions is keen to attract further investors throughout 2025, especially those interested in the rewards offered by EIS.

While the development of hydrogen power is notoriously problematic because a high percentage of the energy value is lost in the process of making it, James and the team are determined to succeed in their mission and report rapid advancements in the field.

Hydrogen Solutions Ltd is developing a Solid Oxide Electrolyser Cell (SOEC)—an advanced technology that efficiently splits water into hydrogen and oxygen.

Compared to current electrolysers like PEM and alkaline systems, their SOEC is 35-45 per cent more efficient, reducing energy consumption and cutting costs for large-scale hydrogen production. Since Electricity is approximately 70% of the cost of green hydrogen from water electrolysis, Hydrogen Solution’s added efficiency is a game changer.

Using ceramic seal technology in the development of electrolysers, the team says they have now created an SOEC that could change the face of hydrogen power for good.

Ceramic can not only withstand high temperatures, but it does not degrade like other materials – solving the biggest reliability problem and allowing for higher temperature operation.

James said: "These are exciting times for clean energy innovation and the hydrogen economy. Savvy investors are seeing that and are getting on board at the relatively early stages.

“With tax relief schemes making investment in businesses such as ours even more attractive, especially to those in higher tax brackets, this is investment in all of our futures."

Full details on the Enterprise Investment Scheme can be found on the government website VCM10010 - Enterprise Investment Scheme: overview of EIS reliefs - HMRC internal manual - GOV.UK

As with any investment, independent financial advice should be sought. For more information on Hydrogen Solutions Limited, please visit Hydrogen Solutions Limited