Navigate Your SEIS & EIS Tax Relief with Ease
Investing in early-stage startups can feel like walking a tightrope. The upside is huge—but so is the risk. That’s why the UK government’s Seed Enterprise Investment Scheme (SEIS) and Enterprise Investment Scheme (EIS) exist. They cushion your falls with income tax relief, capital gains tax deferrals, and even loss relief when things don’t go to plan.
In this SEIS investment guide, we break down exactly how to claim loss relief on your SEIS or EIS investments. You’ll learn clear, bite-sized steps—whether you’re an individual angel investor or a corporate backer. Plus, we’ll show why Oriel IPO’s commission-free marketplace and educational tools make your tax journey even smoother. Dive into our SEIS investment guide and revolutionise investment opportunities in the UK
Understanding SEIS & EIS: Your Tax-Smart Duo
What Are SEIS and EIS?
- SEIS (Seed Enterprise Investment Scheme): Designed for startups under two years old, fewer than 25 employees, and gross assets below £200,000.
- EIS (Enterprise Investment Scheme): Suited to slightly larger SMEs (up to 250 employees, £15 million gross assets, trading up to seven years).
Both schemes reward investors:
- Income Tax Relief: 50% under SEIS, 30% under EIS.
- Capital Gains Tax (CGT) Exemption: If shares held for at least three years.
- CGT Deferral (EIS only): Defer gains to a future date.
SEIS tends to be more generous on income relief but caps investments at £100,000 per investor per tax year. EIS offers more flexibility for larger bets—up to £1 million (or £2 million in knowledge-intensive companies).
Why Loss Relief Matters
Early-stage investments aren’t risk-free. Loss relief lets you offset a bad SEIS/EIS deal against your tax bill, softening the blow. In simple terms:
- Calculate your net loss: Investment minus any income tax relief you’ve already claimed.
- Offset that net loss against your income tax (up to your highest rate) or capital gains in the same or previous year—whichever gives a bigger saving.
Imagine pouring £30,000 into an EIS startup, claiming £9,000 income relief (30%), and then watching the share value drop to zero. Your net loss is £21,000. Claiming loss relief at, say, 45% could shave off almost £9,450 from your tax bill. Not bad when the business goes belly-up!
Step-by-Step Guide to Claim Loss Relief
1. Check Your Eligibility
Before anything else, confirm that:
- Your shareholding is under 30%.
- You’re not a paid director or holding preferential shares.
- No family or business associates hold controlling interests.
- You’re not abusing the scheme to dodge tax.
Pro tip: If you’re an angel investing in a startup where you help as a non-executive director, get HMRC’s nod early. That way you stay eligible while adding value to the company.
2. Individual Claimants: Claiming on Your Self-Assessment
When to claim:
Within one year of the self-assessment deadline for the tax year when the loss occurred.
How to claim:
– Use SA108 on your tax return.
– Decide whether to offset against income tax or CGT—pick whichever minimises your bill.
– Specify if you want relief for the current year or the previous year (you can split relief across both).
Against income tax, you deduct your net loss from your taxable income.
Against CGT, you offset losses against gains in the same or future years.
3. Corporate Claimants: Navigating Company Loss Relief
When to claim:
Within two years after the end of the accounting period in which the loss happened.
Key conditions:
- Your company must be an investment company at disposal.
- You must have held that status continuously for up to six years before selling.
- You’re not affiliated or in the same group as the business you invested in.
How relief is granted:
1. Step 1: Deduct losses from profits of the accounting period of the share disposal.
2. Step 2: If losses remain, deduct from profits of an earlier period (within 12 months before the loss period).
If you need hands-on help, Oriel IPO’s team offers educational webinars and guides to walk you through HMRC forms—no surprises.
4. Special Cases: Joint Shares & Nil Value Claims
- Joint owners: Each person is treated as investing half the total cost. Both need SEIS3/EIS3 certificates.
- Nil value claims: If shares drop to zero but haven’t been sold, you can notify HMRC of negligible value—triggering loss relief as if you’d sold at zero.
By the way, you don’t have to navigate all this on your own. Oriel IPO’s platform curates only HMRC-vetted opportunities, so you know every deal meets SEIS/EIS rules.
Discover our SEIS investment guide for smarter tax relief strategies
Maximising Your Return: Beyond Loss Relief
Claiming loss relief is one piece of the puzzle. To truly optimise your SEIS/EIS portfolio:
- Diversify your bets: Spread up to your annual allowance across multiple startups.
- Leverage CGT deferrals: Use EIS deferrals to push gains into periods when your tax rate is lower.
- Plan exits smartly: Hold for at least three years to lock in income and CGT exemptions.
Oriel IPO’s educational hub offers interactive calculators and live webinars to map out these strategies. Plus, their subscription-based model means no hidden fees cut into your gains—startups keep 100% of investments.
Why Oriel IPO Stands Out
You’ve got options—Seedrs, Crowdcube, angels networks. Here’s where Oriel IPO shines:
- Commission-free funding: Your capital goes straight to startups, not platform fees.
- Curated opportunities: Each pitch is vetted for genuine SEIS/EIS eligibility.
- Educational tools: From webinars to step-by-step guides, you stay in control.
By combining direct investor access with in-depth tax guidance, Oriel IPO removes friction from early-stage investing. That means you spend less time on paperwork and more time spotting the next unicorn.
Testimonials
Emily Carter, Angel Investor
“I’d spent hours deciphering HMRC rules before I found Oriel IPO. Their tax guides and intuitive platform cut my admin in half. Now I focus on the deals, not the forms.”
Ravi Singh, SME Founder
“Oriel IPO helped me raise my SEIS round commission-free. The loss relief tutorial gave me confidence to pitch to angels who needed clear tax steps. Win-win.”
Conclusion
Navigating SEIS and EIS loss relief doesn’t have to be a headache. With Oriel IPO’s well-structured marketplace, you get:
- Clear eligibility checks
- Step-by-step HMRC claim processes
- Commission-free funding and educational support
Ready to take control of your tax relief claims and back high-growth startups with confidence? Access the complete SEIS investment guide on Oriel IPO
