HOW TO KEEP MORE OF YOUR HARD EARNED CASH
If you’re feeling the weight of your Income Tax bill and looking for new and creative ways to lighten this particular load, the British government’s SEIS scheme is one of a number of avenues taken by taxpayers across the UK. Whether you’re intrigued but uncertain or just want to know more about the benefits up for grabs, you’ve come to the right place.
Here, we’ll be breaking down the basics of this government scheme, letting you know what’s in it for you and introducing a straight-talking whitepaper that should help you to move forward with confidence.
What is SEIS?
The Seed Enterprise Investment Scheme (SEIS) was designed by the UK government to help very small, early-stage businesses to raise the capital they need to fund their next phase of growth. Criteria for a business to be eligible for this scheme includes (but is not limited to) having fewer than 25 employees and up to a maximum of £200,000 in gross assets.
Launched in 2012 to complement the existing Enterprise Investment Scheme (EIS), SEIS acknowledges the struggles many small business owners face when it comes to bringing in the investment they need to take their enterprise to the next level (as the modest size and short lifetime of these companies make them an inherently riskier investment).
Applicable to shares issued from April 6th 2012 onwards, the scheme rewards investors for putting their money into a qualifying company (in exchange for an equity stake in said company) - and these rewards come in the form of exciting SEIS tax reliefs. Under SEIS, taxpayers are able to invest a maximum of £100,000 in an eligible businessany tax year into any number of qualifying companies and, in return, are able to reap a number of financial benefits.
Benefits of SEIS investment
If you’re considering investing in an eligible enterprise, you’ll be pleased to know that the perks include Income Tax relief of 50% of the amount invested - but in order for you to hold onto your SEIS tax relief, the shares must be held for three years from the date they’re issued.
You’ll also be completely exempt from Capital Gains Tax on everything you earn from your shares (again, as long as they’ve been held for at least three years). If you sell your shares before the three years are up and reinvest any profit into other SEIS-eligible businesses, you’ll be entitled to Capital Gains Relief for up to 50% of the profits. Rounding out your SEIS tax reliefs, Capital Gains Tax can also be written off for up to 50% of the investment amount in the same tax year.
On top of all this, there are, of course, additional advantages to SEIS investment in terms of the stake you’ll hold in the relevant enterprise. As the money you invest is used to help a business grow, you may also be able to enjoy the benefits that come with watching your share in the company increase in value over time.
Put simply, investing through SEIS means you can use some of your personal income to support the development of a British-based enterprise, enjoy generous monthly tax relief and profit from the business’s long-term success.
Read our whitepaper
Now you know the basics of the SEIS scheme, it’s time to learn about all of the less obvious benefits that come with investing in a qualifying company., The next step is to read our new whitepaper. Rather than stating the obvious, this resource provides all the less obvious know-how you’ll need to make an informed decision.
Click the cover to get one step closer to investing in a company that qualifies for the Enterprise Investment Scheme (and reaping all the benefits that come with it).