SEIS and EIS Accountant
Our team of specialists provides tailor-made solutions to meet your needs, covering business structure, business plans and audits. Giving your start-up business the best chance to succeed.
Partnership with Seed Legals
Reviewed by team of legal experts
Fixed price package
Complete HMRC checklist and cover letter package
Help and guidance at every step
Raising capital for your start-up
Persuading and convincing potential investors to provide the necessary funding for a start-up company is not always easy.
This could result from a lack of trading experience, collateral assets, or a higher risk level.
The Seed Enterprise Investment Scheme (SEIS) encourages potential entrepreneurs to invest by providing a tax break.
What is SEIS
This programme is designed to help your company raise funds as it begins to trade. In addition, individual investors who purchase your company’s stock will receive tax benefits as a result of this.
How does the SEIS scheme work?
You can get up to £150,000 if you qualify. Any future investments from government subsidies and incentives received in the three years leading up to and including the anniversary of the original investment are included in this maximum.
Throughout the scheme’s life, your company must meet certain criteria for investors to receive the full amount of tax relief. If the relief is withdrawn, investors may have to pay tax on their income under the scheme.
HMRC expects the funds raised through the share issue to be put to good use in qualifying business activity (growth activities) within three years of the issue date.
Qualifying Criteria
There are various conditions to be met for the company to qualify for the SEIS scheme. The company must:
- Be a company which is trading commercially
- Permanently established in the UK
- Less than 2 years old
- Have fewer than 25 employees
- Less than £200,000 in assets
- Trading for at least 4 months before they can be eligible for SEIS
- Not trading on a recognised stock exchange at the time of the share issue and do not plan to do so
- Not in any financial difficulty
What is EIS?
This scheme, like SEIS, assists your company in raising funds by providing tax benefits to individual investors. Furthermore, it is intended to assist you in expanding your business.
Some rules must be followed in both schemes so that your investors can claim and keep the tax benefits associated with their shares.
Both schemes require that the shares issued meet exact specifications. For example, they must be fully paid up in cash at the time of issue and must be full-risk ordinary shares.
How does EIS work?
You can raise to £5 million per year and a total of £12 million throughout your company’s lifetime, including funds raised through other incentives and schemes.
Your company must receive investment under the scheme within the first seven years of trading commercially.
Knowledge-intensive industries (such as health care, education, and science) are subject to special rules that extend the time and investment limits.
Keep in mind that any funds received from other venture capital schemes must be received within seven years of your company’s first commercial sale.
Why Choose Us
Fusion Accountants in Harrow work with businesses to make sure they benefit fully from investments under SEIS and EIS.
For the duration of the investment, we will ensure that your business complies with all requirements.
We will respond to any queries raised by HMRC to speed up your Advance Assurance of acceptance under your preferred scheme.
Increase the value of your investment proposition so that, once approved by HMRC, you can attract the most investment.
Complete your tax returns to ensure you receive the right amount of tax relief.
Through our approved partner Seed Legals, their team of funding and legal experts have helped numerous entrepreneurs raise money and see their businesses flourish.
SEIS offers very generous tax reliefs to investors:
50% tax break up to £100,000 annual investment.
50% tax relief on capital gains if sold within three years and reinvested in other SEIS companies.
Loss relief if the investment value decreases.
The two-year holding period for inheritance tax relief.
Tax benefits for EIS investors
Annual investment
On annual investments of up to £1 million, a 30% tax break is available. Up to £2 million in EIS funds must be invested in knowledge-intensive businesses.
EIS shares
If you hold EIS shares for the qualifying period, you can avoid paying capital gains tax and keep your income tax relief.
Losses
You can deduct losses on the sale of shares against income in the year sold or the previous year, which may be preferable to set it against a year’s capital gains.
Share value
The value of the shares is exempt from inheritance tax after two years.
Partnership with Seed Legals
Seed Legals has created a tax-efficient EMI plan that is ideal for your company’s needs and growth.
They will communicate with HMRC on your behalf, file all necessary paperwork, and make any necessary revisions. All for an unbeatable low flat rate that is entirely transparent.
Apply for SEIS/EIS in a simple and intuitive workflow
Seed Legals will prepare your application form, cover letter, and HMRC checklist, then passed to their EIS/EIS experts to review.
Review of all documentation
Seed Legals will take care of the application process, ensuring that it complies with the most recent HMRC guidelines to provide you with the most reliable approval available.
Get in touch
Please get in touch with our specialist tax team to find out more about how we can help you with your SEIS or EIS application and any tax needs.
FAQ ‘s
What is the difference between SEIS and EIS?
SEIS stands for Seed Enterprise Investment Scheme and is aimed at start-ups. In contrast, EIS is geared toward more established small and medium-sized businesses.
SEIS-eligible companies tend to be more risky investments, so the tax benefits available to investors are more generous.
What documentation do Seed Legals send to HMRC?
As a minimum you will need to have the following ready:
- A business plan / Pitch Deck
- Three year projected financials
- Share register
- Application form, cover letter & checklist.
You should also be prepared to send your: Company accounts, bank statement, details of previous investment & De minimis aid, letter of engagement from your crowdfunding/investment partner, Articles of Association, and Investment Proposal /Termsheet.
Do I need Advance Assurance?
Advance Assurance will assist you in pitching to them if you’re still looking for investors or in the early stages. Before investing in SEIS/EIS, most investors seek HMRC Advance Assurance. However, if your investors are willing to invest regardless of tax benefits, you can skip Advance Assurance.
Who can access SEIS funding?
- Information tech companies
- Ecommerce marketplaces
- Mobile App development
- Medical research
- Charities/non-profit organisations
- Hospitality sector
Which trades do not qualify for SEIS?
This is a long list but the most common are: Property Development, Banking or Insurance, Accounting or Legal Services and Farming.
Do I need to be incorporated and registered for Corporation Tax to apply for Advance Assurance?
Yes, you must be incorporated to obtain Advanced Assurance, but you do not need to be registered for Corporation Tax to obtain the assurance.
How can I be sure I'll make money if I invest in an SEIS company?
There are risks associated with every investment, but the risks are greatly reduced due to the tax benefits available.