SEIS & EIS

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Investing in growing businesses can be rewarding, but it also comes with risk. To encourage investment in smaller UK companies, the Government introduced two valuable tax relief schemes: the Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS).

Both schemes are designed to reward individuals who invest in qualifying businesses by offering a range of tax advantages. These can include income tax relief, capital gains tax benefits and, in some cases, loss relief if an investment does not perform as expected.

SEIS is aimed at very early-stage businesses, often startups raising investment for the first time. EIS applies to more established companies that are looking to secure further funding to support growth.

For investors, these schemes can play an important role in building a tax-efficient investment portfolio while supporting innovative UK businesses.

Both schemes offer valuable tax advantages for investors, but they apply to companies at different stages of growth. SEIS is designed for younger businesses raising early-stage funding, while EIS supports more established companies looking to scale. The comparison below outlines the main differences investors should be aware of.

EIS vs SEIS at a Glance

Feature	SEIS	EIS
Intended for	Very early-stage companies – new qualifying trade	More established growth companies, qualifying trade
Income Tax Relief	50% of amount invested	30% of amount invested
Maximum Investment by Investor (per tax year)	£200,000	£1 million (£2 million in certain circumstances)
Maximum Company Fundraising Limit	£250,000	From 6 April 2026: up to £10m in 12 months, £24m in total (£20m and £40m respectively for knowledge-intensive companies) Previously/specified: up to £12 million lifetime limit (£20 million for knowledge-intensive companies)
Company Age	Generally less than 3 years of trading and first trade	Generally less than 7 years from first commercial sale (10 years for knowledge-intensive companies)
Maximum Gross Assets	£350,000	£30 million before investment, £35 million after
Maximum Employees	25	250 (500 for knowledge-intensive companies)
Capital Gains Tax Benefits	Available, subject to conditions	Available, subject to conditions
Loss Relief	Available, subject to conditions	Available, subject to conditions
Minimum Holding Period	3 years	3 years

Helping you with your EIS and SEIS claim

Understanding the rules surrounding EIS and SEIS investments is not always straightforward. The tax relief available depends on both the company receiving the investment and your personal circumstances as an investor.

Our tax specialists can help you:

• Understand the tax benefits available under EIS and SEIS
• Review whether an investment is likely to qualify for relief
• Claim EIS and SEIS tax relief through your Self Assessment tax return
• Maximise available income tax and capital gains tax reliefs
• Advise on loss relief where investments have underperformed
• Review existing investments and tax planning opportunities
• Answer any questions about HMRC compliance and reporting requirements

Whether you are considering your first EIS or SEIS investment or already have an established investment portfolio, we can help you make the most of the reliefs available.

Frequently Asked Questions

What is EIS tax relief?

EIS tax relief is available to individuals who invest in qualifying companies through the Enterprise Investment Scheme. The purpose of the scheme is to encourage investment in growing UK businesses by offering generous tax incentives to investors who are prepared to take on an increased level of risk.

What is SEIS tax relief?

SEIS tax relief is available to individuals investing in very early-stage companies through the Seed Enterprise Investment Scheme. Because startup businesses can carry greater risk, SEIS generally offers enhanced tax benefits compared to EIS.

What is the difference between EIS and SEIS?

The main difference is the stage of the company receiving the investment. SEIS is designed for businesses that are starting out, while EIS supports businesses that are more established and looking to raise larger amounts of capital.

The level of tax relief and investment limits also differ between the two schemes.

What tax relief can I claim under EIS?

Eligible investors may be able to claim income tax relief of up to 30% of the amount invested, subject to annual limits and HMRC rules. Additional benefits may include capital gains tax deferral into these shares, and exemption on qualifying gains.

What tax relief can I claim under SEIS?

SEIS currently offers income tax relief of up to 50% of the amount invested, subject to qualifying conditions. Investors may also benefit from capital gains tax advantages depending on their circumstances.

How do I claim EIS or SEIS tax relief?

Tax relief is normally claimed through your Self Assessment tax return once you have received the relevant certificate from the company you invested in. In some cases, relief can also be claimed through an adjustment to your PAYE tax code.

Do I need to be a UK resident to claim EIS or SEIS relief?

Not necessarily. What matters is whether you have a UK income tax liability against which the relief can be claimed. Your eligibility will depend on your personal tax position and professional advice should be sought where appropriate.

How long do I need to hold an EIS or SEIS investment?

To retain the tax relief, shares generally need to be held for at least three years from the date of issue (or from the date the company began trading, if later for EIS). Selling shares too early can result in relief being withdrawn.

What happens if my investment loses value?

One of the lesser-known benefits of EIS and SEIS is that investors may be able to claim loss relief if a qualifying investment is sold at a loss. This can help reduce the overall financial impact of an unsuccessful investment.

Can I carry back EIS or SEIS tax relief to a previous tax year?

In some circumstances, yes. Investors may be able to treat part or all of an investment as though it was made in the previous tax year, allowing relief to be claimed earlier. This can be particularly useful for tax planning purposes.

Are EIS and SEIS investments suitable for everyone?

Not necessarily. While the tax benefits can be attractive, investments in smaller companies carry a higher level of risk and may not be suitable for all investors. The investment itself should always be considered alongside the available tax relief.

What is an EIS3 or SEIS3 certificate?

An EIS3 or SEIS3 certificate is issued once the company has received approval from HMRC. Investors need this certificate to claim their tax relief, so it should be retained with your tax records.

Can I invest through more than one EIS or SEIS company?

Yes. Many investors build a portfolio across several qualifying companies to spread investment risk while making use of the available tax reliefs.

Are there any restrictions to investing in EIS or SEIS?

As well as the limits mentioned above, please note there are various restrictions that can disqualify a person or company from these schemes. For example, persons who are considered “connected” with the company, and their associates, may not be eligible to benefit from these schemes.

How can Alliott’s specialists help?

We advise investors on all aspects of EIS and SEIS tax relief, from understanding the available benefits to preparing and reviewing tax relief claims. Our team can help ensure that relief is claimed correctly and that you receive the maximum tax advantages available under the rules.