How SEIS/EIS will help you raise investment

Apr 21, 2022

If you’ve not heard of the Seed Enterprise Investment Scheme (SEIS) and Enterprise Investment Scheme (EIS), and you’re thinking of raising investment, you need to get up to speed. Both of these schemes make your business a much more attractive proposition to investors. In short, UK tax-paying investors can claim income tax relief of 50% on their investment into an SEIS company or 30% on their investment into an EIS company. 

The key difference between SEIS and EIS is that SEIS is targeted at start-ups and early-stage companies, while EIS can be used by larger and more mature companies – though these are often still relatively small and young in the context of the businesses in the UK. 

2 out of 3 UK Angel Investors say they’ll only invest in S/EIS eligible companies. It is really well worth offering.


So what are these schemes all about?



SEIS helps small, early stage, (and therefore potentially high-risk) companies raise investment by providing tax relief to UK tax-paying investors. This is effectively an incentive and makes investing in a company more attractive. Businesses raising can receive a maximum of £150,000 through SEIS investments. 


In short, a company can qualify for SEIS if it: 

  • is established in the UK
  • is less than 2 years old from the time of first trading
  • has less than £200,000 in gross assets
  • has less than 25 employees
  • carries out a qualifying trade

You can read more about criteria for SEIS here. 



EIS also helps companies raise investment by giving tax relief to UK tax paying investors. But it has different criteria. Companies approved for EIS are able to raise up to £5 million annually and a maximum of £12 million in the company’s lifetime. This also includes amounts received from other venture capital schemes. A company must receive investment under a venture capital scheme within 7 years of its first commercial sale.


A company can use the scheme if it:

  • has made its first commercial sale less than 7 years ago
  • has less than £15 million in gross assets
  • has less than 250 employees
  • has a permanent establishment in the UK
  • carries out a qualifying trade

You can read more about criteria for EIS here


How to apply for SEIS/EIS?

A company that is looking to apply for SEIS/EIS can in the first instance ask HMRC directly if a share issue is likely to qualify before going ahead. This is called advance assurance. A business can then use this to show potential investors that the proposed investment may qualify for a scheme. 

Are you looking for SEIS/EIS? We are partnered with Seed Legals, who will handle the application for you. They have a 92% success rate on S/EIS applications, as opposed to a 62% industry average. SeedLegals generates your completed application form, cover letter and HMRC checklist ready for SEIS/EIS experts to review. We strongly advise you to engage with SeedLegals to support your application, because they ensure your application complies with the latest HMRC guidelines to get you the most reliable approval possible. Get in touch with us today for an introduction.

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