EIS / SEIS for Investors
The Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS) offer substantial tax reliefs to individual investors in qualifying early-stage companies. These reliefs can significantly reduce the effective cost and risk of investment, making EIS and SEIS an attractive component of a broader tax planning strategy.
What are the benefits?
Income Tax Relief
EIS investors receive 30% Income Tax relief on investments up to £1m per year (£2m where invested in knowledge-intensive companies). SEIS investors receive 50% relief on investments up to £200,000. This significantly reduces the effective cost of the investment.
CGT Exemption on Exit
Shares held for at least three years and qualifying for EIS or SEIS Income Tax relief are completely exempt from CGT on disposal — regardless of the size of the gain.
CGT Deferral (EIS)
EIS investment can be used to defer CGT from other disposals by reinvesting the gain into qualifying EIS shares. The deferred gain is only brought back into charge when the EIS shares are eventually disposed of.
Loss Relief
Where an EIS or SEIS investment results in a loss, investors can elect to offset the net loss (after Income Tax relief) against their income in the same or preceding year, at their marginal tax rate — significantly limiting the downside.
How can Zenus Tax help?
We advise on whether EIS or SEIS investment is appropriate for your tax position
We review the EIS3/SEIS3 certificates issued by companies and ensure relief is correctly claimed
We prepare the relevant sections of your Self Assessment return
We advise on CGT deferral through EIS investment following other asset disposals
Frequently Asked Questions
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