Pixel

SEIS in 2018

Gary Green
Gary Green
April 7, 2015

Many of our clients are asking whether anything significant has changed regarding the SEIS scheme in 2018.

Are there any major changes to the SEIS scheme in 2018? The short answer is ‘no’, meaning that the government is still supporting a widely popular funding option for new companies.

Rule Changes

There are a couple of minor changes and clarifications that we'll address now.

One of the recent changes allows investment raising from SEIS to EIS immediately. Previously, you had to wait until 70% of the SEIS finds were spent first. This can give a wider appeal to multiple investors, and make new companies reach for a bigger investment target than previously imagined.

Certainly, conversations can start sooner about getting company funding of more than the £150,000 SEIS threshold. However, there is now a time limit of 12 years since the first commercial sale in which to receive EIS or VCT funding.

"Independent" Investors

The one other change to SEIS may potentially cause a few issues. It is rather vaguely worded and unclear who it is trying to target. It says that investors have to be "independent" from the company at the time of the first share issue.

We contacted HMRC for further clarification. Our understanding, at this moment, is that you can't become a director of the company prior to being given the SEIS shares.

This could impact on who incorporates the company. It may even lead to newly formed companies being scrapped and recreated just to cater for this new rule.
It's hard to see how this rule is an improvement. Investors are already prohibited from benefiting from SEIS tax relief if:

  • They hold more than the 30% of the shares, and...
  • The company starts to trade prior to the share issue.

We also are pleased that inheritance tax planning is still available. Up to £100,000 per year is now available for SEIS tax relief within two years instead of seven.

Interested in our services?
Fill in your details and a member of our experienced team will be in touch shortly to discuss your needs.
We adhere to strict GDPR rules and do not reveal or sell your data to any third-parties. For more, please read our Privacy Policy.
Latest Insights
May 5, 2021
How To Reduce Corporation Tax by Claiming Creative Industry Tax Reliefs

Creative Industry Tax Reliefs (CITR) are a collection of Corporation Tax reliefs that allow qualifying companies...

April 27, 2021
National Minimum & Living Wage Considerations For Employers

One of our most important jobs, as employers, is to help control payroll costs. However, one...

April 20, 2021
Employment Allowance: How to Make and Backdate a Claim

The Employment Allowance allows eligible employers to reduce their National Insurance liability. The allowance increased to...

April 20, 2021
How to Get an Overseas Employee Set Up on UK Payroll

Getting an overseas employee set up on UK Payroll can be complex. Employers in the UK...

April 15, 2021
How To File Your Company End-of-Year Accounts For The First Time

If you have recently setup a new limited company or are thinking of doing so, then...

April 13, 2021
How Does Equity Crowdfunding Work? All You Need to Know

In this article, we uncover the ins and outs of equity crowdfunding and the key considerations...

April 8, 2021
Why You Should Set Up a Trust To Cut Inheritance Tax

Inheritance Tax (IHT) is levied on a person’s estate when they die and can also be...

April 1, 2021
The Best Tax-Efficient Options To Pay Yourself As A Business Owner

Most director shareholders want to ensure that they pay the combined lowest rate of tax possible...

March 29, 2021
Chancellor Warns Businesses to Keep Offices – But Remote Working Is Here to Stay

Despite the UK's 'work from home' guidance likely to come to an end in late June,...

View Our latest insights »
Get the latest UK tax & business news and guidance delivered straight to your inbox
We care about the protection of your data. No spam. Unsubscribe anytime.
02037 282 848
Mon-Fri 9am - 5.30pm
contact@keybusinessconsultants.co.uk
expert financial advice at your fingertips
Copyright © 2021 Key Business Consultants LLP. Reg: E&W OC389322
linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram