SEIS IS TARGETED AT
SOURCING INVESTMENT IN
What’s the difference between SEIS and EIS?
SEIS is targeted at sourcing investment in early-stage companies, whereas EIS helps more established businesses gain funding. The criteria for qualification are different, with EIS allowing investment for companies with up to 250 employees and up to £15 million in assets. Because of the additional risks of investing in even smaller companies compared to larger ones, an SEIS investment comes with different and valuable tax benefits compared with an EIS. These include relief from income tax, inheritance tax and capital gains tax. In addition, any losses can be offset against earnings and capital gains, which is known as ‘loss relief’.
Benefits of investing in a SEIS
- Access to investments in Start-up stage companies
- Up to 50% income tax relief, provided investment is held for a minimum of three years
- Potential for 100% relief on inheritance tax (available after holding investment for two years and provided shares are still held at time of death)
- If you have received income tax relief on the cost of the shares, and the shares are sold after they have been held for at least 3 years, any profit is free from Capital Gains Tax.