Newsletter: SEIS & EIS for startups and investors

Autumn is somehow here (where did summer go?) and the end of 2022 is creeping up on us – as is Halloween. But before fright night kicks in, we have some good news to share in the form of an update on SEIS and EIS schemes.

Support for these valuable investment schemes was extended in last month’s mini-budget and they offer big opportunities for start-ups and investors. Plus, if the thought of Companies House filings sends shivers down your spine help is at hand in the form of our company secretarial package – more on this below in this newsletter!

Two-minute masterclass: EIS & SEIS - a guide for start-ups & investors

Need to know: Two investment schemes that help start-ups raise funds by offering tax breaks to investors.

Enterprise Investment Scheme (EIS): Available since the mid-90s and has raised £23 billion for more than 40,000 companies.
Seed Enterprise Investment Scheme (SEIS): Available since 2012 and aims to draw investment into smaller high-risk companies.

What was said in the mini-budget? SEIS and EIS regimes will be extended beyond the previously planned end-date of April 2025. Increases to SEIS investment thresholds and a relaxation of some eligibility criteria that will come in to effect on 6 April 2023. When new Chancellor Jeremy Hunt made his statement on 17 October, he outlined that wider reforms to investment taxes would continue. We believe this means the planned SEIS extension and increases will remain.

EIS & SEIS – summary of key eligibility criteria for businesses

SEIS (until 5 April 2023)SEIS (from 6 April 2023)EIS
Maximum trading age of business2 years3 years7 years
Maximum number of employees2525250
Maximum gross assets£200,000£350,000£15 million

Benefits to investors: Tax reliefs available under the schemes counterbalance the risk that comes with investing in smaller start-up companies. In essence, EIS/SEIS minimise losses for an investor in the event of a company failing.

Benefits to startups: The schemes make investment in smaller and higher risk companies more attractive to investors, making it easier for start-ups to secure funding. Under the EIS, an individual can invest up to £1 million per tax year and £100,000 per tax year under the SEIS (rising to £200,000 after April 6 2023), so a sizeable investment in the business.

Give me more!
For a more detailed guide to SEIS and EIS, with worked examples of investments and detailed eligibility criteria, check out Enterprise Investment Schemes (EIS) & Seed Enterprise Investment Schemes (SEIS)

Need fundraising advice?

Want legal advice on fundraising and investment? Contact us today to speak to our expert, Bill.

Never miss a Companies House filing again!

Our experienced legal team can help with your essential Company Secretarial obligations. All filings will be made ahead of critical deadlines, giving you peace of mind that these essential actions are being taken care of.

We can help with:

  • Compliance with the Companies Act obligations for directors
  • Maintenance of the company’s Statutory Register (including changes to the Share Register,
  • Register of Directors and Secretaries PSC Registers and Register of Charges)
  • Filing of annual Confirmation Statements
  • Filing of Amendments to the Companies Articles
  • Production of Share Certificates

Pricing: £150 + VAT / Month or £1,500 + VAT / year (when paid in advance)

To find out more contact us today.

Great news from 7L & our clients

Congratulations to Lawhive, who have just raised a $2M Seed round! We’re very happy to have helped in reaching this major milestone. You can read more about this story in Sifted.

We’re celebrating 22 months of positive climate impact at Seven Legal. We’ve supported 36 environmental and sustainability projects through our work with Ecologi and planted 3,649 trees.

Visit our Ecologi forest or check out our sustainability page for more details.

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Get in touch...

That’s all for this month, but if you have any queries or want to chat through any legal concerns, you can get in touch with us any time.

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