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 £16n of private funding has been raised by EIS companies across the UK since the scheme’s inception in 1994 and 2012*. 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:

  1. Size of intended investment
  2. Single investment or spread of investments
  3. Sectors that may be of interest
  4. 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.

For further information, please contact:

* The most recent HMRC statistics available.

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