SEIS and EIS Tax Relief Services in London – Secure Funding & Maximise Tax Savings

To get SEIS and EIS tax relief, businesses must not only meet the eligibility requirements but also follow HMRC rules carefully. Even small mistakes can disqualify them from tax benefits, so expert help is crucial.

At Clarkwell, we focus on SEIS and EIS compliance in London. We assist startups in staying compliant and avoiding expensive errors.

Common SEIS and EIS Compliance Mistakes Businesses Make

Many startups accidentally break SEIS and EIS rules, which can cause investors to lose tax relief. Here are the most common mistakes:

• Not Meeting Eligibility Criteria: Businesses must always meet SEIS/EIS conditions, including trading activities, employee limits, and share types. Changes in company status can affect eligibility.
• Issuing Incorrect Shares: SEIS/EIS shares must be ordinary shares without special rights. Issuing preference or convertible shares can disqualify the company.
• Using Funds Incorrectly: SEIS and EIS funds should be spent on qualifying activities like innovation, development, and job creation. Using funds for non-qualifying purposes, such as paying off debt or buying assets, can invalidate tax relief.
• Missing HMRC Filing Deadlines: Businesses need to submit compliance statements (SEIS1/EIS1 forms) on time. Delays or mistakes in paperwork can postpone or cancel tax relief.
• Failing to Hold Shares Long Enough: Investors must hold SEIS/EIS shares for at least three years to keep their tax relief. Selling or transferring shares too soon will result in losing tax benefits.
• Overlooking Annual Compliance Requirements: SEIS and EIS require ongoing compliance with HMRC rules. Not reporting changes or failing to submit required documents can lead to losing investor tax relief.

At Clarkwell, we simplify SEIS and EIS compliance, helping your business meet HMRC rules and gain investor trust. 

• Ongoing Monitoring: We track your company’s status, finances, and share structure to ensure you stay compliant.
• Correct Share Issuance: Our team makes sure shares meet HMRC’s SEIS/EIS standards, preventing costly mistakes that could disqualify you.
• Proper Use of Funds: We guide you on how to spend SEIS/EIS money on eligible activities to keep your tax relief.
• Timely Filings: We manage submissions like SEIS1 and EIS1, investor certificates, and annual reports, ensuring you never miss a deadline.
• Investor Support: We help investors claim SEIS/EIS tax relief correctly, ensuring they meet holding period rules and maximise their benefits.
• Annual Reviews: Our yearly checks help businesses spot risks early and avoid penalties.

Applying for SEIS and EIS tax relief can be complicated and take a lot of time. It needs careful documentation and must follow HMRC rules. At Clarkwell, we help businesses in London with SEIS and EIS applications, making it easier to get funding without the hassle of paperwork and legal issues.

Our clear guidance simplifies the process. This lets startups focus on growing their business while we take care of the application from beginning to end.

Step-by-Step Guidance on Applying for SEIS/EIS Tax Relief

We have a clear and effective method to help businesses meet SEIS/EIS requirements and get approved fast.

Step 1: Business Eligibility Assessment

We begin by reviewing your business to confirm it meets SEIS and EIS requirements. This includes checking:

• Your company’s trading activities and incorporation date.
• Employee count and asset value to confirm eligibility.
• Whether your planned use of investment funds complies with HMRC regulations.

Step 2: Preparation of SEIS/EIS Business Plan

A good business plan helps you get approval. We create a clear SEIS/EIS-approved business plan that shows:

• The company’s growth potential and financial forecasts.
• Compliance with SEIS/EIS funding requirements.
• Key details to attract potential investors.

Step 3: Advance Assurance Application

Before issuing shares, get Advance Assurance from HMRC. This confirms to investors that your company qualifies for SEIS/EIS tax relief. We:

• Prepare and submit the Advance Assurance application with supporting documents.
• Communicate directly with HMRC to address any queries.
• Help improve approval chances by ensuring compliance with strict HMRC guidelines.

Step 4: Share Issuance & Investment Compliance

Once Advance Assurance is approved, businesses can begin offering SEIS/EIS-eligible shares to investors. We make sure:

• Shares meet HMRC’s SEIS/EIS qualification rules.
• Proper share allotment and filings with Companies House.
• Full compliance to prevent tax relief disqualification.

Step 5: SEIS/EIS Compliance Statement Submission

After issuing shares and receiving investments, we submit the SEIS1/EIS1 compliance statement to HMRC. This confirms that your company meets SEIS/EIS requirements, allowing investors to claim tax relief.

Step 6: Issuing SEIS3/EIS3 Certificates to Investors

After HMRC approves the compliance statement, we help issue SEIS3/EIS3 certificates to investors so they can claim their tax relief benefits.

SEIS Eligibility for Businesses

To qualify for SEIS, a business must:

• Be UK-based and actively trading
• Have been trading for less than 2 years
• Have fewer than 25 employees
• Have gross assets under £350,000
• Raise a maximum of £250,000 through SEIS
• Not be involved in excluded activities (e.g., property development, financial services)

EIS Eligibility for Businesses

To qualify for EIS, a business must:

• Be UK-based and actively trading
• Have been trading for less than 7 years
• Have fewer than 250 employees
• Have gross assets under £15 million
• Raise a maximum of £5 million per year (£12 million total)
• Not be involved in excluded activities

SEIS/EIS Investor Eligibility

To claim SEIS or EIS tax relief, an investor must:

• Be a UK taxpayer
• Hold shares for at least 3 years to retain tax relief
• Invest a maximum of £100,000 per year in SEIS and £1 million per year in EIS
• Not have a controlling interest in the company they invest in

Make SEIS and EIS Easy with Clarkwell’s Expert Support

Applying for SEIS and EIS can be complicated, but Clarkwell’s accountants in London make it easy. If you’re a startup looking for funding or an investor wanting tax benefits, we help you follow HMRC rules and maximise your gains.

Need assistance with SEIS/EIS applications or tax relief claims? Contact us today for expert help!

Knowing how SEIS and EIS tax relief works can help startups and investors get the most benefits while following HMRC rules. Here, we explain the process in easy steps for businesses and investors.

Step-by-Step Guide to Claiming SEIS and EIS Tax Relief

For Businesses: How to Apply for SEIS and EIS Approval

If you’re a startup looking to raise funds through SEIS or EIS, follow these steps:

Step 1: Create a Business Plan for SEIS/EIS  

Your business needs a clear plan focused on growth that meets SEIS/EIS funding rules. A strong plan attracts investors and follows HMRC guidelines.

Step 2: Get Advance Assurance from HMRC  

Before raising money, apply for Advance Assurance. This shows potential investors that your company qualifies for SEIS or EIS, boosting their confidence and improving your chances of getting funds.

Step 3: Issue SEIS/EIS Shares to Investors  

After approval, you can give shares to eligible investors under SEIS/EIS rules. These shares must meet certain criteria for investors to get tax relief.

Step 4: Submit a Compliance Statement (SEIS1 or EIS1 Form)  

After issuing shares, complete and send the SEIS1 or EIS1 compliance statement to HMRC. This certifies that your business meets the program requirements.

Step 5: Provide SEIS/EIS Certificates to Investors  

Once HMRC approves the compliance statement, give SEIS3 or EIS3 certificates to investors. They need these certificates to claim their tax relief.

For Investors: How to Claim SEIS/EIS Tax Relief

Investors who fund SEIS/EIS-approved startups can claim tax relief by following these steps:

Step 1: Check Investment Eligibility for SEIS/EIS  

Investors should verify that the startup has Advance Assurance from HMRC and that the investment qualifies for SEIS/EIS.

Step 2: Get SEIS3 or EIS3 Certificate from the Company  

The startup must provide the investor with an SEIS3 or EIS3 certificate. This certificate is essential for claiming tax relief.

Step 3: Claim SEIS/EIS Tax Relief Through Self-Assessment  

Investors can claim tax relief by filling out their Self-Assessment tax return and submitting the SEIS3/EIS3 certificate details to HMRC.

Step 4: Claim Capital Gains Tax Exemptions and Loss Relief  

If eligible, investors can defer Capital Gains Tax on reinvested gains, apply for inheritance tax relief, and claim loss relief if the business fails.