Quick Insights: Are You Eligible? Understanding SEIS/EIS Criteria

Series 1: Getting Started with SEIS/EIS

Your go-to resource for navigating the ins and outs of the Seed Enterprise Investment Scheme (SEIS) & Enterprise Investment Scheme (EIS)!

If you’re eyeing the SEIS/EIS schemes as a golden ticket to funding and growth, you’re on the right path. But, there’s a catch – you’ve got to tick certain boxes to qualify. Worry not, we’re here to break down the eligibility criteria for both schemes, making sure you know if your startup stands a chance to benefit from these financial boosts. Let’s unravel the mystery.

SEIS/EIS Eligibility: A Closer Look

Both the SEIS and EIS have been designed with specific types of businesses in mind, aiming to fuel innovation and growth in the UK economy. While they share some common ground, the criteria for eligibility vary, reflecting the schemes’ focus on different stages of a startup’s lifecycle.

SEIS Eligibility

To qualify for the Seed Enterprise Investment Scheme:

  • Your business must be relatively new, with a trading history of not more than two years.
  • You must be a UK-based company with a permanent establishment in the country.
  • Your company should have gross assets of no more than £200,000 before the SEIS shares are issued.
  • The company should employ less than 25 employees at the time of the share issue.
  • Your business must not have received EIS or Venture Capital Trust (VCT) funding prior to the SEIS investment.

EIS Eligibility

For the Enterprise Investment Scheme:

  • There’s no specific requirement regarding how long your company has been trading, but it must carry out a qualifying trade in the UK.
  • The company must have no more than £15 million in gross assets before the shares are issued and no more than £16 million immediately after.
  • It should have fewer than 250 full-time employees at the time of the share issue.
  • The company must be independent, not controlled by another company.

Common Ground

For both schemes, the company must be conducting a qualifying trade. Most trades qualify, but there are exceptions, such as financial services and property development, among others. Additionally, the investment must be used for a qualifying business activity, typically meaning it needs to support the growth and development of the company.

The Bottom Line

Understanding the eligibility criteria for SEIS/EIS is crucial before setting your sights on these funding schemes. They offer a fantastic opportunity for startups to secure investment but navigating the qualifications requires a clear understanding of the requirements. If you’re unsure whether your startup qualifies, it’s worth seeking professional advice from a financial expert (hey, that’s us!) to explore your options. Up next, we’ll delve into the benefits of SEIS/EIS for your startup, helping you weigh the advantages of pursuing these opportunities. 

Ready to make the most of SEIS/EIS for your startup? Let’s chat! Whether you’re seeking clarity on eligibility, benefits, or advance assurance, we’re here to guide you through the process. Book a no-obligation consultation with Elliott Gaspar, Standard Ledger’s Founding UK Director, and unlock the potential of these valuable investment schemes for your startup.

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