EIS and SEIS: tax relief for investing in small companies
EIS and SEIS: tax relief for investing in small companies
The Enterprise Investment Scheme and Seed Enterprise Investment Scheme give generous tax reliefs to people who invest in small, higher-risk UK companies.

- SEIS: 50% Income Tax relief on up to £200,000
- EIS: 30% relief on up to £1 million, or £2m for knowledge-intensive
- Gains on qualifying shares are CGT-free after 3 years
- Loss relief if the company fails
For founders, they make raising money easier. For investors, they offer Income Tax relief, CGT exemptions and loss relief.
This guide explains how the schemes work and the key conditions.
Investor reliefs
| Relief | SEIS | EIS |
|---|---|---|
| Income Tax relief | 50% | 30% |
| Annual investment limit | £200,000 | £1m, or £2m for knowledge-intensive |
| CGT on disposal | Exempt after 3 years | Exempt after 3 years |
| CGT reinvestment | 50% of gain exempt | Deferral |
| Loss relief | Against income | Against income |
Shares must be held for at least three years. Carry back to the previous tax year is possible.
Income tax calculator
See your relief.
Ayo, an additional rate taxpayer, invests £20,000 in a qualifying SEIS company. She gets £10,000 of Income Tax relief. If the company fails, she can claim loss relief on the net cost of £10,000 against her income at 45%, £4,500, so her real loss is £5,500. If it succeeds, any gain after three years is CGT-free.
Company conditions
- UK permanent establishment and a qualifying trade
- Limits on gross assets, employees and company age
- Excluded activities, such as property development and financial services
- Lifetime and annual limits on money raised under the schemes
The schemes have been extended to April 2035.
Fixed-fee accountancy support
Transparent monthly packages for sole traders, landlords and limited companies. Fixed fees agreed upfront, VAT included.
Get a fixed-fee quoteCall 0161 531 4179Advance assurance
Companies can ask HMRC for advance assurance before raising, which gives investors confidence. After the shares are issued, the company files a compliance statement and investors receive certificates to claim relief.
Connected investors
Investors connected to the company, such as holding more than 30% or being paid employees, generally can’t claim. Directors can invest under SEIS if not otherwise connected.
See HMRC’s guidance on EIS and our tax planning service.
What should I do next?
Trade and limits.
Before raising.
To claim relief.
Frequently Asked Questions
What is SEIS relief?
50% Income Tax relief on investments of up to £200,000 a year in qualifying start-ups.
What is EIS relief?
30% Income Tax relief on up to £1 million a year, or £2 million for knowledge-intensive companies.
How long must I hold the shares?
At least three years.
Are gains tax-free?
Yes, gains on qualifying shares are CGT-free after three years.
What if the company fails?
You can claim loss relief against income.
Need help with this? Wingate Accountants offers fixed-fee online accountancy support across the UK. Call 0161 531 4179 or request a quote at wingateaccountants.co.uk.
About the Author
Stephen Reynold
I’m Stephen Reynold, an accountant at Wingate Accountants. I work with sole traders and small companies, turning tax rules into clear, practical next steps.








