The Seed Enterprise Investment Scheme (SEIS) changes from April 2023

As a part of its September 2022 mini budget, the government announced a series of changes regarding SEIS investments which are planned to come into effect from the 6 April 2023. By way of a reminder, SEIS investments offer an investor 50% income tax relief on the value of any qualifying investment made. The investments may also attract significant capital gains tax reliefs.

Currently no changes have been announced for Enterprise Investment Schemes (EIS) but the government mentioned they remain committed to supporting this scheme.

Changes for Investors

Currently an investor can invest up to £100,000 in SEIS shares in a tax year, this would enable them to obtain income tax relief of up to £50,000 per tax year (£100,000 X 50%).

From the start of the 2023-24 tax year (6 April 2023), the permitted investment limit will double to £200,000 per tax year. This will allow an investor to claim up to a maximum of £100,000 income tax relief on qualifying SEIS investments made in a tax year (£200,000 X 50%).

Changes in Company Conditions

The rules surrounding what is a qualifying company for SEIS purposes will also change. From April 2023, the following changes will be introduced:

• Qualifying companies trading age limit is being extended from 2 to 3 years.
• Qualifying companies can have gross assets of up to £350,000 in value. This is an increase from the £200,000 previously in place.
• Qualifying companies can now raise up to £250,000 in SEIS investment as opposed to the previous limit of £150,000

Find out how to claim tax relief and more here in the Fact sheet

For further information, please contact Joe Wilson on 023 8046 1237