The rules for both the EIS and SEIS schemes clearly state the eligibility requirements for using the schemes.
Raising finance is not just a matter of meeting the eligibility requirements. You also have to ensure that your business can attract investors. However, the two work together. A company eligible for EIS or SEIS will be a more tempting investment opportunity.
The main conditions that a company must meet in order to obtain SEIS/EIS qualifying status are:
We would always recommend getting pre-approval from HMRC. Technically, it is just an assurance based on the information that you present to them. But it's still a good indication as to whether your company qualifies. Advance assurance service from HMRC is a discretionary, non-statutory, service.
Since January 2018, HMRC no longer provides advance assurance on speculative applications. This leaves some start-ups in a Catch-22 situation where it can be hard to attract investment without advance assurance. However, HMRC does not require the company to have formalised offers of investment. Rather, it must have some potential investors on board who are likely to invest if you get advance assurance.
We would be happy to discuss any questions you may have, contact us now.
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