SEIS—conditions for relief: issuing company

The following Tax practice note provides comprehensive and up to date legal information covering:

  • SEIS—conditions for relief: issuing company
  • Conditions relating to the issuing company
  • Conditions on the date the shares are issued
  • Issuing company unquoted
  • Gross asset limit
  • Employee limit
  • EIS or venture capital trust investment
  • SEIS investment limit
  • Financial health
  • Conditions the company must meet throughout period A
  • More...

SEIS—conditions for relief: issuing company

IP COMPLETION DAY: The Brexit transition period ended at 11pm on 31 December 2020. At this time (referred to in UK law as ‘IP completion day’), transitional arrangements ended and significant changes began to take effect across the UK’s legal regime. This document contains guidance on subjects impacted by these changes. Before continuing your research, see Practice Note: What does IP completion day mean for Tax?

The seed enterprise investment scheme (SEIS), like the enterprise investment scheme (EIS), is designed to encourage investment in smaller, higher-risk trading companies by offering a range of tax reliefs to individual investors purchasing newly issued shares in those companies.

To be eligible for SEIS relief the regime imposes numerous requirements that must be met, including in relation to:

  1. the individual investors

  2. the issued shares, the funds raised and arrangements in general, and

  3. the issuing company

This Practice Note focuses on the conditions applicable to the issuing company and its group (if any). Note, however, that the issuing company will also have to take account of all the other conditions for SEIS relief set out in the further Practice Notes referenced below.

The conditions are described in the context of SEIS income tax relief provided for in Part 5A of the Income Tax Act 2007 (ITA 2007).

Relief from capital gains tax (CGT) (under the disposal exemption or re-investment relief)

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