What is SEIS/EIS and how do you qualify?

what is SEIS/EIS and how do you qualify

The most recent report published by the Britsh Business Bank stated that:

  • 86% of Angels invest because of SEIS/EIS
  • 78% of Angels invest in riskier businesses because of SEIS/EIS
  • 87% of deals used SEIS/EIS 

So, what is SEIS/EIS and how do you qualify?

 

S E E D   E N T E R P R I S E   I N V E S T M E N T   S C H E M E 

SEIS (Seed Enterprise Investment Scheme) is there to help your business raise money when it's starting to trade, by offering tax reliefs to individual investors buying shares in the business. It's important to note that this isn't relief for the business but for the Investors, which in turn benefits the business by making the investment proposition more appealing. 

You can receive a maximum of £150,000 through SEIS investments on which your Investors can claim relief. The money you raise from the investment must be spent within 3 years from the share issue and must be spent on the qualifying business activity it was raised for.

You can ask HMRC if your share issue is likely to qualify before going ahead, this is called advanced assurance.

For a full understanding on SEIS, how to apply and if you qualify CLICK HERE.

 

E N T E R P R I S E   I N V E S T M E N T   S C H E M E 

EIS (Enterprise Investment Scheme) offers tax relief to individual Investors who buy new shares in your business to help it grow. 

Under EIS, you can raise up to £5million each year, and a maximum of £12million in your Company's lifetime. It's worth noting that tax reliefs will be witheld/withdrawn from your Investors if you fon't follow the rules for at least 3 years after the investment is made. The money raised by the new share issue must be used for a qualifying business activity, which is:

  • A qualifying trade
  • Preparing to carry out a qualifying trade 
  • Research and development that's expected to lead to a qualifying trade

For a full understanding on EIS, how to apply and if you qualify CLICK HERE.