Business

SEIS vs EIS, which one is right for your startup?

Rachel Abraham

04.11.26

Read time 9 minutes

The Seed Enterprise Investment Scheme (SEIS) and Enterprise Investment Scheme (EIS) are designed to help qualifying UK companies raise equity investment. They can also make an investment more attractive to individuals by offering tax relief when the relevant conditions are met. The schemes are similar, but they’re aimed at different stages of a company's development.

This guide compares SEIS and EIS for UK founders and explains what to check before presenting either option to investors. It also covers how Wise Business can help UK startups manage day-to-day business expenses and international payments that come with a funding round, helping you scale globally with ease.

💡 Learn more about Wise Business for startups

Disclaimer: The contents of this article is for informational purposes only and does not constitute legal or tax advice. Decisions related to tax should be made after thorough research, consultation and verification from a qualified financial and legal advisor.

What is SEIS?

SEIS is intended to help very early-stage companies raise equity. Investors who subscribe for qualifying new shares may be able to claim 50% Income Tax relief on up to £200,000 of investment in a tax year, subject to the scheme rules and their own tax position.²

For a company to use SEIS, it generally needs to meet conditions, including:⁴

Being established in the UK and carrying on a new qualifying trade
Having fewer than 25 full-time equivalent employees
Having no more than £350,000 in gross assets when the shares are issued
Having a qualifying trade that hasn’t been carried on for more than 3 years, whether by the company or by someone who transferred it to the company
Using the money raised for an eligible business activity within the required period
Not having already received investment through EIS or a Venture Capital Trust for the same company

The company can receive a maximum of £250,000 through SEIS. That amount includes relevant de minimis state aid and may affect later funding under other venture capital schemes.⁴

SEIS doesn’t turn a high-risk investment into a low-risk one; investors still buy shares in a young business, and relief can be withheld or withdrawn if the company or investment doesn’t meet the conditions.⁴

What is EIS?

EIS is designed for qualifying companies that are still relatively young and small, but may be further along than an SEIS company. Investors may be able to claim 30% Income Tax relief on up to £1 million of qualifying investment in a tax year.² The individual limit can be higher for investments in knowledge-intensive companies.

The company-level conditions include requirements relating to:³

A permanent establishment in the UK
The nature of the trade and the way the group is structured
Employee numbers and gross assets
The age of the company, measured from its first commercial sale
How the money is used
The risk-to-capital condition
The maximum amount raised through the scheme and other venture capital schemes.

Most companies can raise up to £24 million through the relevant venture capital schemes over their lifetime, but higher or different limits can apply in specific circumstances. For example, companies carrying out qualifying research, development or innovation may fall under different limits.¹

The HMRC EIS application guidance sets out the conditions in more detail. It also explains that the company must use the money raised for a qualifying activity and that investors need to meet the scheme rules to keep their relief.³

💡 Explore our guide to: series A funding and startup growth stages, from pre-seed to IPO

What are the main differences between SEIS and EIS?

Difference	SEIS	EIS
Company age and scale	Tighter limits on the company’s age, assets and employee numbers.¹ This may make it a better fit for a newly trading business still proving its product, service or route to market.	Allows a larger company and a higher funding requirement, while still focusing on qualifying growth businesses rather than established companies of any size.¹
Amount you can raise	Capped at £250,000 under current guidance.¹	The general EIS and VCT lifetime limit for most companies is £24 million.¹
How much to raise	The maximum available may not be the right amount. The appropriate amount depends on the milestones the company needs to reach, the evidence it can show investors and the equity it is prepared to issue.	The appropriate amount depends on the company’s milestones, evidence for investors and the equity it is prepared to issue.
Investor tax relief	Offers 50% headline Income Tax relief, but the investment amount eligible for relief is lower.²	Offers 30% relief on a higher annual investment limit for individuals who meet the conditions.²
Other investor reliefs	Investors may also be able to access Capital Gains Tax reliefs or loss relief, subject to their own conditions.²	Investors may also be able to access Capital Gains Tax reliefs or loss relief, subject to their own conditions.² These should not be presented as automatic benefits.
Fundraising sequence	A company cannot use SEIS if it has already received EIS or VCT investment.¹˒⁴	Founders planning more than one funding round should model the intended sequence before accepting commitments.

*Data checked on 11 October 2026.

This publication is provided for general information purposes and does not constitute legal, tax or other professional advice from Wise Payments Limited, its subsidiaries or affiliates. It should not be treated as advice from, or a communication with, HMRC, and it is not intended as a substitute for obtaining business advice from a tax advisor or any other professional.

The HMRC guidance on venture capital schemes contains the current company-level limits.¹ Check the full conditions before describing a funding round as SEIS- or EIS-eligible.

How to decide between SEIS and EIS

There's a few considerations when putting forward SEIS and EIS options, including:

Start with the company's eligibility

Don’t choose a scheme only because the headline investor relief sounds attractive, a good idea is to create a checklist covering:

Incorporation and trading dates
First commercial sale
Group structure and subsidiaries
Full-time equivalent employees
Gross assets
Proposed use of funds
Previous venture capital scheme investment
The company's trade and risk-to-capital position.

If any part of the position is unclear, ask a qualified adviser to review it before you market the round.

Size the round around milestones

Work backwards from the next meaningful milestone. That might be a product launch, regulatory approval, customer target, hiring plan or route to revenue. Build a cash-flow forecast with a buffer, then decide how much capital is needed to reach that point.

If you'll pay overseas developers, suppliers or contractors from the money you raise, build the cost of those payments into the forecast. You can make these payments with Wise Business - funds are converted at the mid-market exchange rate, with the fee shown before you confirm each payment, so your forecast accurately reflects the cost of each payment.

Consider investor expectations

SEIS can be useful when a company is at a very early stage and is seeking angel investment within the scheme's limits. EIS may be more relevant when the company has progressed further or needs a larger round.

That’s a starting point rather than a rule, the right route depends on the company's facts and the specific share issue. An adviser can help you understand how the scheme interacts with share rights, previous funding and the wider cap table.

Apply for advance assurance where appropriate

Companies can ask HMRC for advance assurance that a proposed share issue is likely to qualify.¹ It isn’t a guarantee that investors will receive relief: the company, the investment and the investor must still satisfy the conditions.

Prepare the information investors and HMRC will need, including the business plan, financial forecasts, ownership details, use of funds and details of the proposed share issue.^3,4

Keep records after the investment

Eligibility doesn’t end when the money arrives. Keep evidence of how the funds are used, the share issue, the company's continuing conditions and the communications provided to investors. The company has responsibilities after the investment if investors are to claim and keep their relief.^3,4

HMRC expects SEIS money to be spent within 3 years of the share issue, and EIS money within 2 years of the investment (or the date you start trading, if later).⁴ Wise Business lets you download a transfer confirmation once a transfer is complete and can connect to accounting software, so a record of what you paid and when builds up as you spend.

Common mistakes to avoid

Here's a few common hurdles to keep in mind:

Treating advance assurance as approval: Advance assurance is an indication that the proposed share issue is likely to meet certain conditions. It isn’t a blanket approval and cannot replace a full eligibility review.¹

Using old thresholds: SEIS and EIS limits have changed over time, so it’s best to always check the current HMRC guidance. For example, HMRC updated the EIS amounts that can be raised on 6 April 2026.³

Presenting relief as a guaranteed return: Tax relief doesn’t guarantee that an investor will make money. Shares can lose value, and relief may be affected by the investor's circumstances or by the company failing to meet the rules.

Ignoring the share terms: The rights attached to the shares and the way the investment is structured matter. Ask legal and tax advisers to review the documents before you promise investors that a round qualifies.

Raising without a cap table plan: SEIS or EIS can help you attract funding, but it doesn’t remove the need to plan dilution, option pools, future rounds and decision-making rights.

SEIS vs EIS: a practical decision checklist

Before you speak to investors, check that you can answer:

Is the company within the relevant age and trading limits?
Does the group meet the employee and gross asset tests?
Is the trade eligible and does the risk-to-capital condition apply?
How much has the company already raised through venture capital schemes?
What will the new money be used for, and within what timeframe?
Does the proposed share issue meet the relevant requirements?
Have the company's tax and legal advisers reviewed the position?
Do the investor materials explain risk as well as potential tax relief?
Is the funding sequence compatible with any future SEIS or EIS round?

💡 For a related look at early-stage funding structures, see Wise's guide to Advanced Subscription Agreements

Manage funding and scale globally the smart way, with Wise Business

Wise Business multi-currency account can help you manage domestic funding seamlessly, from payment automation, API, invoice creation and integration with accounting software. And, if any of your investors, suppliers or advisers are based in different countries or you need international payment administration built into the fundraising plan, the capabilities are even more powerful.

With local account details in major currencies like USD and EUR, you’ll be able to receive funding and spend as if you were a locally trading business - helping you keep more of your earnings. And you can turn on Wise Interest to make your funding reserves work harder, with the ability to earn a return in multiple currencies in your balance (capital at risk, growth not guaranteed). Send and spend funding around the world with large volume discounts and flexible transfer limits.

Wise can help make international payment administration easier to plan and enable businesses to scale globally, for less. Wise Business offers a free Essential plan for basic spending and transferring. If you need to receive money, set up direct debits, or generate invoices, you'll pay a one-time £50 setup fee to unlock the Advanced features.

Get started with Wise Business

Here's everything your growing startup can leverage. With Wise Business, you can:

🌍 Send money to 70+ countries and pay overseas invoices at the mid-market exchange rate with low, transparent fees and no hidden exchange rate markups (product availability varies by region)
📥 Receive payments in 24 currencies and counting
💵 Get local account details for 8+ currencies, including USD and EUR, to let your customers pay in a currency they know and trust - convenience for them and peace of mind for you
💰 Hold money in 40+ currencies
🔁 Convert currencies anytime at the mid-market exchange rate with low, transparent fees
⚡ Use the batch payments tool to create and send up to 1,000 payments in a single transfer
👥 Run payroll and make international payments for up to 1,000 employees all over the world - including paying suppliers using local payment methods like ACH, SEPA, and Faster Payments
💳 Get business debit cards with 0.5% cashback for you and your team to keep track of team expenses and spend all over the world, with real-time visibility and categorisation. See full cashback terms and conditions
🏢 Manage cash in 55+ currencies across international offices from a single business account and move money between business accounts in seconds (exact speeds can vary depending on individual circumstances and may not be the same for all transactions)
🧾 Connect and sync every business transaction to your favourite accounting software, including Xero, Quickbooks, and more
🔐 Create your own payment approvals process to manage your team better with customised access for different team members, roles and permissions
📑 Create custom professional invoices and schedule invoice payments for future dates
📈 Earn variable returns on GBP, USD and EUR with Wise Interest (Growth not guaranteed. Your balance will go down in the event of a government default or interest rates going negative.)
🔗 Create payment links and QR codes to get paid easily (Card payment acceptance for new Wise Business customers is currently unavailable. Payment methods subject to eligibility and availability.)
⚙️ Automate payouts with the Wise API (comes with 24/7 customer support, a sandbox account to test integrations, API tokens, and clear documents on how to implement and make the most of our API)

Make the wise choice when selecting a business account for your domestic and global needs.

Be Smart, Get Wise.

Wise Interest disclaimer: Growth not guaranteed. Your balance will go down in the event of a government default or interest rates going negative. Taxes may apply. 3.32% variable rate on GBP is based on 7 day performance as of 05 Aug 2026. For full 5-year past performance and fund information, visit https://wise.com/interest. Investments are offered by Wise Assets UK Ltd. (FRN 839689)

Sources:

Sources last checked: 11th Oct 2026

*Please see terms of use and product availability for your region or visit Wise fees and pricing for the most up to date pricing and fee information.

This publication is provided for general information purposes and does not constitute legal, tax or other professional advice from Wise Payments Limited or its subsidiaries and its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.

We make no representations, warranties or guarantees, whether expressed or implied, that the content in the publication is accurate, complete or up to date.