TL;DR
SEIS and EIS are UK venture capital schemes that can give qualifying Investors tax relief when they subscribe for eligible new shares in qualifying companies. SEIS is aimed at smaller, younger companies; EIS supports larger eligible companies and larger fundraising needs.
SEIS and EIS compared
According to HMRC guidance updated on 6 April 2026, SEIS allows eligible Investors to claim 50% income tax relief on up to GBP 200,000, while EIS allows 30% relief on up to GBP 1 million, or GBP 2 million where at least GBP 1 million is invested in knowledge-intensive companies. Source: GOV.UK Investor tax relief guidance.
| Scheme | Typical company fit | Investor relief headline | Founder watchpoint |
|---|---|---|---|
| SEIS | Very early UK companies with a new qualifying trade. | 50% income tax relief on qualifying investment up to the annual Investor limit. | Company age, gross assets, employee count, prior EIS/VCT investment, and share terms matter. |
| EIS | Eligible UK companies raising larger amounts after or beyond SEIS. | 30% income tax relief on qualifying investment within annual limits. | Rules are broader but still detailed, especially around company size, trade, Investor connection, and use of funds. |
Also Read: Types of startup funding
SEIS eligibility points founders should verify
HMRC says a company using SEIS must meet conditions including carrying out a new qualifying trade, being established in the UK, not being listed on a recognised stock exchange, not having gross assets over GBP 350,000 when shares are issued, and having fewer than 25 full-time equivalent employees. HMRC also says the company cannot use SEIS if it has already received EIS or VCT investment. Source: GOV.UK SEIS company guidance.
EIS eligibility points founders should verify
HMRC guidance says an EIS company and qualifying subsidiaries must generally have fewer than 250 full-time equivalent employees and gross assets not exceeding GBP 30 million before the share issue and GBP 35 million afterwards, with different limits for specified companies. The company must also carry out a qualifying trade and meet other conditions. Source: GOV.UK EIS company guidance.
Why SEIS and EIS affect Investor appetite
Tax relief can improve the risk-adjusted case for an Investor, especially at angel stage. That does not mean founders should accept any capital that wants tax relief. The better test is whether the Investor also brings sector judgment, follow-on credibility, useful introductions, and patience for the company's actual risk profile.
Founder checklist before outreach
- Confirm eligibility with qualified UK tax and legal advisers.
- Prepare or update advance assurance materials where appropriate.
- Check share class terms against scheme requirements.
- Document use of funds and qualifying trade assumptions.
- Keep compliance certificates, Investor communications, cap table records, and source documents in the Data Room.
Bottom line
SEIS and EIS can make UK startup funding easier to close, but they raise the bar for precision. The founder should sell the company on evidence and ambition, then use SEIS or EIS eligibility to reduce Investor friction. Reversing that order attracts tax-driven capital without necessarily improving the company.