SEIS Tax Relief Calculator

Why SEIS is the UK's Best Tax Relief

The Seed Enterprise Investment Scheme offers the most generous tax reliefs available to UK investors:

1. 50% Income Tax Relief

• Claim back HALF of your investment as income tax relief
• Maximum investment: £200,000 per year = up to £100,000 tax back
• Can carry back to previous tax year
• Reduces your effective investment cost to just 50%

2. 50% CGT Reinvestment Relief

• Reinvest capital gains into SEIS shares
• 50% of the reinvested gain becomes completely tax-free
• Unlike EIS deferral, this is an exemption - the gain is eliminated
• No need to match investment to gain amount

3. Tax-Free Growth

• All gains on SEIS shares are 100% tax-free
• Hold for minimum 3 years
• No capital gains tax on disposal - ever

4. Enhanced Loss Relief

• If the company fails, offset losses against income tax
• Loss = 50% of investment (after income tax relief)
• At 45% tax, recover 22.5% more through loss relief
• Maximum downside: just 27.5% of original investment

SEIS Investment Example: £100,000

Qualifying for SEIS

Investor Requirements

• Must be UK taxpayer
• Cannot own more than 30% of the company (or be an associate of 30%+ owner)
• Cannot be an employee (but paid directors are allowed)
• Must subscribe for new shares issued by the company
• Shares must be paid for in cash

Company Requirements

• UK permanent establishment
• Gross assets under £350,000 before investment
• Fewer than 25 employees
• Less than 3 years old
• Carrying on (or preparing to carry on) a qualifying trade
• Never received EIS or VCT investment before
• Can raise maximum £250,000 through SEIS

SEIS vs EIS: Do Both!

Smart investors often combine SEIS and EIS investments in the same tax year:

SEIS Investment Strategy: Key Considerations for 2025/26

The Seed Enterprise Investment Scheme remains the most generous tax relief available to UK investors in the 2025/26 tax year, but making the most of SEIS requires careful planning and a clear understanding of the rules, risks, and strategic opportunities. Whether you are considering your first angel investment or building a diversified portfolio of early-stage companies, the following considerations are essential.

Understanding SEIS Qualifying Companies

Not every startup qualifies for SEIS, and investors must be diligent in verifying a company's eligibility before committing capital. A qualifying SEIS company must have a permanent establishment in the UK, have been trading for less than three years, employ fewer than 25 full-time equivalent employees, and hold gross assets of no more than £350,000 before the investment is made. The company must also be carrying on, or preparing to carry on, a qualifying trade -- which excludes certain sectors such as property development, financial services, legal services, farming, and operating hotels or nursing homes.

One of the most critical eligibility requirements is that the company must not have previously received investment under the Enterprise Investment Scheme (EIS) or from a Venture Capital Trust (VCT). This means SEIS is genuinely targeted at the earliest stage of a company's life. Companies can raise a maximum of £250,000 in total through SEIS. Investors should always confirm that the company has obtained, or is in the process of obtaining, advance assurance from HMRC that the investment will qualify for SEIS relief. Without this assurance, there is a risk that tax relief could be denied after the investment has been made.

Risk Factors and Diversification

While the tax reliefs available through SEIS are exceptionally generous, it is vital to recognise that investing in seed-stage companies carries substantial risk. Research from the British Business Bank and various angel investment networks consistently shows that the majority of seed-stage startups fail within their first five years. Even with the downside protection afforded by income tax relief and loss relief -- which limits the maximum loss for a 45% taxpayer to just 27.5% of the original investment -- capital is still at risk, and there is no guarantee of any return.

Experienced SEIS investors typically spread their annual allocation across multiple companies to diversify risk. For example, rather than investing the full £200,000 allowance into a single company, an investor might distribute £10,000 to £25,000 across eight to twenty different SEIS-qualifying startups. This portfolio approach increases the probability that at least some investments will succeed and deliver tax-free returns, while the losses on failed investments are significantly cushioned by the combined effect of income tax relief and loss relief. Several UK platforms and angel investment networks now offer curated SEIS funds and portfolios specifically designed to provide this diversification.

Combining SEIS with EIS for Maximum Tax Efficiency

One of the most powerful strategies available to UK taxpayers is to combine SEIS and EIS investments within the same tax year. By investing up to £200,000 in SEIS-qualifying companies (claiming 50% income tax relief, or up to £100,000) and up to £1 million in EIS-qualifying companies (claiming 30% income tax relief, or up to £300,000), an investor can potentially claim up to £400,000 in income tax relief in a single year. This combined approach is particularly attractive for individuals with large income tax liabilities, such as business owners who have sold a company, senior professionals with high earnings, or landlords with significant rental income.

Additionally, both SEIS and EIS allow carry-back of income tax relief to the previous tax year, subject to that year's respective investment limits. This means an investment made before 5th April 2026 could generate tax relief against the 2024/25 tax year as well as the 2025/26 tax year, effectively doubling the available relief for well-timed investments. Investors should work closely with a qualified tax adviser to structure their SEIS and EIS investments in the most tax-efficient manner, ensuring they remain within all applicable limits and meet the three-year minimum holding period for each scheme.