Enterprise Investment Scheme

As some of the most important tax schemes for small businesses hoping to raise external capital by using favourable reliefs to attract investors, both the Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS) can considerably reduce the risk of outsiders investing in your business.


For EIS and SEIS status, a company has to apply to HMRC, and this is where an experienced professional can help.

HMRC uses various criteria in deciding which companies qualify for SEIS and EIS status. For the latter, key points include:

• Gross assets under £15m

• Fewer than 250 members of staff

• Not an excluded trade
• Unquoted enterprise (AIM allowed)

For SEIS status, the criteria are the same with the exception of employees and assets; applicants must have fewer than 50 employees and gross assets under £200,000.


If your company is successful in its application, your attractiveness as a lucrative opportunity for investors will increase dramatically. Tax breaks will be available to those who hold less than 30% of the company shares and are not connected to it in any way – for example, as a director or employee.


The risks are reduced significantly. To give an example, if a high rate tax payer invested in a SEIS company, the tax reliefs would mean that, if the investment went awry, a potential loss of £10,000 could be cut down to just £1,350. In the case of a failed investment with an EIS company, tax reliefs could see that £10,000 reduced to just £3,850.


Please check out our Dragons’ Den [insert link] article to see how these reliefs can work in real life.