EIS/SEIS uses tax reliefs to incentivise private investors who recognise that significant returns are achievable if they are willing to risk their funds by investing in early stage businesses. Early stage businesses often struggle to raise equity finance so EIS/SEIS has established itself as a trusted and crucial source of equity funding. The schemes therefore play an important role in facilitating the smooth flow of risk equity capital from private individuals to early stage businesses.
EIS/SEIS is appropriate for Investors who wish to include in their portfolio some higher risk based companies. EISA recommends taking professional advice before investing in EIS/SEIS funds or companies since the rules governing the EIS/SEIS are complex and interrelated with other legislation.
Over £22Bn of private funding has been raised by EIS companies across the UK since the scheme’s inception in 1994 and May 2020*. These range from small ‘friends and family’ rounds, business angel investments where individuals are contributing skill as well as funding, through to formal public offers and EIS funds. The number of professionally managed EIS/SEIS funds is growing and the sector is well established.
It is a useful exercise to consider some or all of the following prior to assessing your investment:
- Size of intended investment
- Single investment or spread of investments
- Sectors that may be of interest
- Passive or active ie business angel wishing to deploy skills
Please note: The Association neither endorses any particular member, product or company/firm wishing to raise money under the EIS/SEIS nor does it accept any liability for advice given by its members.
For full details of the tax reliefs available, please view the video below. For details on claiming EIS Tax Relief click here…
Additional information is available from the following all of which provide independent commentary and details of EIS/SEIS Offers and Funds.
- MJ Hudson. You can register for a free database of open offers at www.advantageiq.co.uk Similarly contact Lauren Radford at lauren.radford@mjhudson.com, or call 020 7079 1000 or visit www.mjhudson.com to find out about their research options.
- Angel News Ltd. Contact Modwenna Rees-Mogg on 01749 344888 or www.angelnews.co.uk email: modwenna@angelnews.co.uk
- Hardman & Co. Contact Pamela Lopez on 020 7929 3399 or www.hardmanandco.com email: pl@hardmanandco.com
- MICAP – MI Capital Research Ltd – Contact Guy Tolhurst on 020 3422 0100 or www.micap.com email: guy.tolhurst@micap.com
- Tax Efficient Review – Contact Martin Churchill on 020 8458 9003 or www.taxefficientreview.com email: martin@taxefficientreview.com
- Global Live streaming Partner: Fantastic Beasts TV produces a live stream of your physical event with up to three cameras, using optimised lighting and audio; then distribute your live event to our global VC, CVC, angel, Family Office, and your virtual audiences. More information at www.fantasticbeasts.tv/pitchcast Email: li@fantasticbeasts.tv
For further information, please contact:
- Your independent financial adviser for advice pertinent to your personal circumstances;
- HMRC – Venture Capital Reliefs Team, Mid-size Business SO777, Newcastle NE98 1ZZ. Tel: 0300 123 1083
Please note that individual tax enquiries should be addressed directly with your own Inspector of Taxes and not the The Enterprise Centre, nor is EISA able to help with individual queries. - For general information on EIS And SEIS please look at the Factsheets on the website. For more complex queries, do contact one of the EISA members in the relevant category – Members, or your own professional adviser.
* The most recent HMRC statistics available.