A Smarter Route to Keeping More of Your Money
Tax bills can feel punishing when you’re a higher earner. If you’re earning north of £100,000, you’ve probably asked yourself: “How can I keep more of what I earn?” Enter EIS benefits—a suite of Enterprise Investment Scheme reliefs designed to reduce your income tax, defer capital gains and even shield assets from inheritance tax. Throw in SEIS, and you’ve got a powerful duo to accelerate your wealth growth without bending the rules.
In this guide, you’ll learn how SEIS and EIS relief work, why they matter for higher earners, and how Oriel IPO’s commission-free marketplace helps you access vetted deals. Ready to see how tax-efficient investing can change your financial game? Discover EIS benefits and revolutionise investment opportunities in the UK
Why Tax-Efficient Investing Matters
Everyone loves higher returns. But at the end of the day, you pay tax on most of your gains. If you’re in the 40% or 45% bracket, that’s a hefty slice gone before you even think about spending or reinvesting. Tax-efficient investing lets you shelter growth and dividends in legal, government-backed wrappers.
- Reduces your effective tax rate.
- Reinvests what you’d otherwise pay in tax.
- Builds a more resilient portfolio over the long haul.
Even if you’re seasoned with ISAs and pensions, adding SEIS and EIS to the mix can unlock fresh avenues to save thousands each year.
Understanding SEIS and EIS: Powerful Reliefs for You
The government created SEIS (Seed Enterprise Investment Scheme) and EIS (Enterprise Investment Scheme) to channel funds into early-stage and growing businesses. They reward investors with genuine risk-taking by offering EIS benefits such as:
- 30% income tax relief on amounts invested (up to £1 million per tax year).
- Capital Gains Tax (CGT) deferral on gains from other investments when re-invested into EIS-eligible companies.
- Tax-free growth—profits on EIS shares are exempt from CGT if held at least three years.
- Inheritance Tax relief—qualifying shares can fall outside your estate after two years.
And SEIS goes further for seed financings with 50% income tax relief on up to £100,000 invested each year, plus partial CGT reinvestment relief. Together, SEIS and EIS benefits are tailor-made for higher earners who want to keep more of their wealth working for them.
Key EIS Benefits Explained
1. Income Tax Relief
Paying 30p less in tax for every £1 invested feels great. If you put £50,000 into an EIS fund, you could claim £15,000 back off your income tax bill. That reduces your net cost to £35,000—freeing up capital to reinvest elsewhere.
2. Capital Gains Deferral & Exemption
Got a tidy profit from selling shares or property? Instead of handing HMRC their cut, you can roll those gains into an EIS deal and defer the tax bill until you dispose of your EIS stake. If you hold those shares for at least three years, any gain you make is entirely tax-free.
3. Inheritance Tax Relief
Concerned about passing on your estate? Qualifying EIS shares can be 100% exempt from inheritance tax after two years in your portfolio. That’s a powerful tool for legacy planning—especially when coupled with discretionary trusts or gifting strategies.
How Oriel IPO Enhances Your EIS Journey
Navigating SEIS and EIS paperwork alone can be daunting. Oriel IPO steps in as a UK-based, commission-free marketplace that does the heavy lifting:
- Curated, vetted investment opportunities that meet SEIS/EIS rules.
- Educational tools—guides, webinars and insights—to clarify reliefs.
- Transparent subscription fees, so startups keep every pound they raise.
- Direct connections with angel investors keen on tax-efficient investing.
By centralising deals and trimming out commission costs, Oriel IPO makes it easier to capture every one of those EIS benefits without hidden fees or guesswork. Maximise EIS benefits with our commission-free marketplace
Comparing EIS with Other Tax Wrappers
You already know ISAs and pensions. SEIS and EIS simply augment your toolkit:
- ISAs: tax-free growth, but no upfront relief.
- Pensions: upfront tax relief, locked until retirement.
- VCTs: 30% relief, but higher minimums and five-year holds.
- EIS: flexible investment sizes, deferral options, CGT exemption.
In short, EIS sits between ISAs and pensions. It gives immediate relief like pensions, plus tax-free growth like ISAs—while funding UK businesses in need of capital.
Practical Steps to Claim EIS Benefits
- Identify a suitable opportunity: Use Oriel IPO’s platform to shortlist SEIS/EIS-qualified startups.
- Complete due diligence: Review company pitches, financials and growth plans.
- Invest through the marketplace: Submit funds and paperwork—Oriel IPO streamlines the process.
- Apply relief on your tax return: HMRC guidance is built into the platform’s support portal.
- Hold shares for at least three years: Lock-in period ensures you capture the full suite of EIS benefits.
By following these steps, you can integrate EIS into your wider portfolio without missing a beat.
Real-World Example: The High-Earning Investor
Meet Laura, a project manager who earns £120,000 a year. In 2023, she:
- Invested £60,000 into an EIS-eligible tech scale-up.
- Claimed £18,000 in income tax relief.
- Deferred a £30,000 capital gain from an ISA sale by rolling it into the same EIS deal.
Three years later, Laura’s EIS shares doubled in value. She exited, and thanks to the CGT exemption, didn’t pay a penny on the gain. All up, she saved more than £25,000 in taxes—and supported a promising UK startup.
Risks and Considerations
Of course, higher rewards come with higher risk:
- EIS firms are often early-stage and less liquid.
- Your capital is tied up for at least three years.
- Companies can fail—diversification is key.
Balance EIS with low-risk ISAs, pensions and bonds. That way, you keep a safety net while chasing enhanced EIS benefits.
FAQs About EIS Benefits
Q: Can I lose my relief if the company folds?
Yes. If an EIS business becomes worthless, you lose the tax relief on that investment. You can, however, offset the loss against your income tax bill.
Q: How much can I invest per year?
Up to £1 million under EIS, plus an additional £1 million via knowledge-intensive schemes—subject to a £12 million company fundraising cap.
Q: Do I need professional advice?
While Oriel IPO provides resources, it’s wise to consult an independent tax adviser for complex portfolios or larger sums.
Conclusion
If you’re serious about reducing your tax bill and boosting long-term growth, SEIS and EIS deserve a spot in your portfolio. They offer a rare blend of upfront relief, CGT deferral and inheritance tax planning—all while backing the next wave of UK innovation. Oriel IPO’s commission-free, curated marketplace and hands-on guidance make capturing every ounce of EIS benefits straightforward and stress-free.
