The schemes
Enterprise Investment Scheme (EIS)
Income tax relief and CGT benefits on investments in certain unquoted trading companies, plus CGT deferral when reinvesting gains.
Seed Enterprise Investment Scheme (SEIS)
A junior version of EIS for very early-stage companies. Reinvestment relief can exempt 50% of a qualifying gain reinvested in SEIS shares.
Venture Capital Trusts (VCTs)
Managed funds investing in smaller, higher-risk unquoted companies, with relief on new VCT shares.
Social Investment Relief
Closed to new investments on 6 April 2023.
Who qualifies
- EIS and SEIS: the company must be a qualifying unquoted trading company, and you generally can’t hold more than 30% of the shares or be an employee.
- VCTs: you must be 18 or over and subscribe for new VCT shares.
- All schemes: you must be a UK taxpayer, stay within annual limits and hold shares for the minimum period.
How to claim
The company issues an EIS3 or SEIS3 certificate (or a VCT certificate), which you use to claim income tax relief through Self Assessment. Claims are normally due within five years of the end of the tax year of investment. Keep certificates safely.
FAQs
Frequently asked questions
How much income tax relief can I get?
EIS up to 30%, SEIS up to 50% and VCTs 30%.
What is the maximum I can invest?
EIS up to £1 million a year (£2 million for knowledge-intensive companies). SEIS and VCTs each up to £200,000.
What if I sell my shares too soon?
Disposing before the minimum holding period, usually three years, may mean repaying the relief and paying CGT.