Can a company use both SEIS and EIS?

Yes. A company can raise under SEIS first (up to £250,000 lifetime) and then use EIS for subsequent rounds (up to £12 million lifetime, or £20 million for knowledge-intensive companies). Many startups follow exactly this path.

Which gives investors better tax relief?

SEIS offers 50% income tax relief versus 30% for EIS. SEIS also offers 50% CGT reinvestment relief on gains reinvested into SEIS shares. For investors, SEIS is more generous per pound invested.

What if my company is too old for SEIS?

SEIS is limited to companies less than 3 years old. If your company has passed this threshold but is under 7 years old (12 for knowledge-intensive), you can still use EIS. The age clock starts from when the company began its qualifying trade.

Do I need separate advance assurance for each scheme?

Yes. SEIS and EIS are separate schemes with separate advance assurance applications. If you plan to raise under both, you will need two applications. Many founders start with SEIS advance assurance and apply for EIS when planning a later round.

How much can my company raise under each scheme?

SEIS: up to £250,000 total (lifetime). EIS: up to £12 million total (£20 million for knowledge-intensive companies). Annual EIS raise is capped at £5 million. These limits include any previous SEIS/EIS/VCT funding received.

Can a company use both SEIS and EIS?

Yes. A company can raise under SEIS first (up to £250,000 lifetime) and then use EIS for subsequent rounds (up to £12 million lifetime, or £20 million for knowledge-intensive companies). Many startups follow exactly this path.

Which gives investors better tax relief?

SEIS offers 50% income tax relief versus 30% for EIS. SEIS also offers 50% CGT reinvestment relief on gains reinvested into SEIS shares. For investors, SEIS is more generous per pound invested.

What if my company is too old for SEIS?

SEIS is limited to companies less than 3 years old. If your company has passed this threshold but is under 7 years old (12 for knowledge-intensive), you can still use EIS. The age clock starts from when the company began its qualifying trade.

Do I need separate advance assurance for each scheme?

Yes. SEIS and EIS are separate schemes with separate advance assurance applications. If you plan to raise under both, you will need two applications. Many founders start with SEIS advance assurance and apply for EIS when planning a later round.

How much can my company raise under each scheme?

SEIS: up to £250,000 total (lifetime). EIS: up to £12 million total (£20 million for knowledge-intensive companies). Annual EIS raise is capped at £5 million. These limits include any previous SEIS/EIS/VCT funding received.

SEIS vs EIS: Which Scheme Is Right for Your Startup?

The UK has two main tax-efficient investment schemes for startups: the Seed Enterprise Investment Scheme (SEIS) and the Enterprise Investment Scheme (EIS). Both offer generous tax reliefs to investors, but they serve different stages of a company’s growth.

This guide compares the two schemes head-to-head, explains when to use each, and helps you decide which advance assurance application to prepare first.

The Core Difference

SEIS is for seed-stage companies. It offers more generous tax relief but has stricter limits on company size, age, and how much can be raised.

EIS is for growth-stage companies. It offers slightly less generous tax relief but allows much larger raises and has more relaxed eligibility criteria.

Most startups use SEIS first and graduate to EIS as they grow.

Head-to-Head Comparison

Feature	SEIS	EIS
Income tax relief	50%	30%
Investor annual limit	£200,000	£1,000,000
Company lifetime limit	£250,000	£12 million (£20m KIC)
CGT exemption	Yes (3-year hold)	Yes (3-year hold)
CGT reinvestment relief	50%	Deferral only
Loss relief	Yes	Yes
Company age limit	Less than 3 years	Less than 7 years (12 KIC)
Employee limit	25 FTE	250 FTE
Gross assets limit	£350,000	£15 million
Legislation	ITA 2007 Part 5A	ITA 2007 Part 5

KIC = Knowledge-Intensive Company

Tax Relief in Practice

SEIS: 50% Income Tax Relief

An investor puts £50,000 into your SEIS-qualifying startup. They receive £25,000 back as income tax relief. If the startup succeeds and they exit after 3+ years, the gain is completely CGT-free.

If the startup fails, they can claim loss relief on the remaining £25,000 (investment minus tax relief received). For a 45% taxpayer, that is £11,250 back. Total loss: £13,750 on a £50,000 investment — just 27.5p in the pound.

EIS: 30% Income Tax Relief

An investor puts £100,000 into your EIS-qualifying startup. They receive £30,000 back as income tax relief. If the startup succeeds and they exit after 3+ years, the gain is completely CGT-free.

If the startup fails, they can claim loss relief on the remaining £70,000. For a 45% taxpayer, that is £31,500 back. Total loss: £38,500 on a £100,000 investment — 38.5p in the pound.

When to Use SEIS

SEIS is the right choice if:

Your company has been trading for less than 3 years
You have fewer than 25 full-time employees
Your gross assets are under £350,000
You are raising up to £250,000 in this funding round
This is your company’s first external raise

SEIS is the most common starting point for pre-seed and seed-stage UK startups. The 50% income tax relief makes it extremely attractive to angel investors.

When to Use EIS

EIS is the right choice if:

Your company is over 3 years old (but under 7)
You have more than 25 employees (but under 250)
Your gross assets exceed £350,000 (but are under £15 million)
You are raising more than £250,000
You have already used your full SEIS allowance

EIS is typically used for Series A and later rounds, or by companies that have outgrown SEIS eligibility limits.

Using Both Schemes

Many startups use SEIS and EIS in sequence:

Seed round: Raise up to £250,000 under SEIS. Investors get 50% income tax relief.
Growth round: Raise under EIS for subsequent rounds. Investors get 30% income tax relief.

This is perfectly allowed — the schemes are designed to complement each other. Each requires a separate advance assurance application.

Qualifying Trade Rules

Both schemes require the company to carry on a qualifying trade. The excluded activities are largely the same for both:

Property development
Financial services (banking, insurance, fund management)
Legal and accountancy services
Energy generation (with some exceptions)
Hotels, nursing homes, and residential care
Farming and market gardening

If your company carries on a trade that is not on the excluded list, it is likely a qualifying trade. The eligibility checker can help you confirm this quickly.

The Advance Assurance Process

For both SEIS and EIS, the advance assurance process is the same:

Prepare an application covering your qualifying trade, share structure, company details, and investment plans
Submit to HMRC’s Small Companies Enterprise Centre (SCEC)
Wait 6 to 8 weeks for HMRC’s response
Receive an assurance letter (or a request for further information)

Each scheme requires its own separate application. If you plan to raise under both SEIS and EIS, you will need two applications.

Which Should You Apply for First?

If your company qualifies for both schemes, start with SEIS. The reasons:

SEIS offers more generous tax relief, making your raise more attractive
SEIS has a lower company limit (£250,000), so you will use it up faster
Getting SEIS advance assurance first gives you momentum for investor conversations
You can apply for EIS advance assurance separately when planning your next round

Next Steps

Whether you choose SEIS, EIS, or both, advance assurance is the critical first step. It tells investors that HMRC has reviewed your company and indicated it qualifies, removing the biggest barrier to tax-efficient investment.