The Investment Reliefs which include the Seed Enterprise Investment Scheme (SEIS), the Enterprise Investment Scheme (EIS) and Venture Capital Trusts (VCTs) all serve a similar purpose — to support entrepreneurship by giving investors tax relief on investment in startups. The tax incentives include Income Tax Relief, no Capital Gains Tax, and Loss Relief if the business fails. The schemes have existed for decades and have so far helped more than 59,000 founders to secure investment. To date, £34 billion has been invested through the SEIS and EIS, and £12 billion through VCTs.

HMRC administers the schemes and not all companies qualify — there are certain company age and sector requirements, and there has to be ‘risk to the capital’ being invested.

These schemes are widely recognised as being world leading and are a significant reason why many talented entrepreneurs from across the world chose to base their businesses in the UK. Data show that 50% of UK unicorns were EIS backed, including the likes of Revolut, Deliveroo and Zoopla.

Further reading

This entry was written by Christiana Lockhart-Stewart. Christiana is the Director General of the Enterprise Investment Scheme Association.