Log in
FundingUpdated 2026-10-19

How much can I raise under SEIS?

Quick Answer

A company can raise up to £250,000 in total under SEIS. Individual investors can invest up to £200,000 per tax year across all SEIS investments and receive 50% income tax relief.

Let Finn handle this for you

AccountsOS does your books for you. Ask Finn about your own business, no signup needed.

Detailed Explanation

SEIS fundraising limits

The Seed Enterprise Investment Scheme has strict limits on both the company and investor side.

Company limits

- Maximum raise

£250,000 in total under SEIS (lifetime cap per company) - **Timing

Company eligibility requirements

  • Less than **3 years old** from the date of first commercial sale
  • Fewer than **25 full-time equivalent employees**
  • Gross assets of no more than **£350,000** immediately before the share issue
  • Must carry on a **qualifying trade** (or be preparing to do so)
  • Must not be controlled by another company
  • Must have a **permanent establishment in the UK**
  • Must not be listed on a recognised stock exchange

Investor limits

  • Maximum of **£200,000** per tax year across all SEIS investments
  • This is a per-person limit, not per-company
  • Married couples and civil partners each have their own £200,000 allowance

Tax relief for investors

| Relief | Amount | |---|---| | Income tax relief | 50% of amount invested | | CGT exemption | 100% on gains from SEIS shares (after 3 years) | | CGT reinvestment relief | 50% of gains reinvested into SEIS shares exempt from CGT | | Loss relief | Available at marginal income tax rate |

Example

An investor puts £100,000 into a SEIS-qualifying company: - Income tax relief: £50,000 (50% of £100,000) - If they reinvested a £100,000 capital gain: £50,000 of that gain is exempt from CGT - If the company fails: the net cost after all reliefs can be as low as £13,500 on a £100,000 investment

Key requirement: the 70% spend rule

At least 70% of the SEIS money raised must be spent on qualifying business activity before the company can raise further investment under EIS. This prevents companies from using SEIS purely as a stepping stone without genuine trading activity.

Practical tips

  • Get advance assurance from HMRC before approaching investors
  • Structure your fundraising to use SEIS first, then EIS for subsequent rounds
  • Keep detailed records of how SEIS funds are spent to satisfy the 70% rule
  • Remember the £350,000 gross assets test is measured immediately before the share issue, not after

Source: HMRC VCM30000 - SEIS Manual

Real-World Examples

Early Stage Startup

You're starting a tech company and need seed funding. You secure £200,000 from several SEIS investors to develop your MVP. Because this is your first external funding round, you can utilise the full £200,000 towards your SEIS allowance.

Restaurant Expansion

You've run a successful restaurant for a year and are looking to open a second location. You aim to raise £150,000 through SEIS to cover fitting costs and initial marketing. Since you are within the 3-year trading window, you can still use SEIS funding as long as your total SEIS funding doesn't exceed £250,000.

Software Development

A software company previously raised £100,000 under SEIS. It requires a further £200,000 for expansion. It can only raise an additional £150,000 through SEIS as it is capped at the £250,000 maximum.

Common Mistakes to Avoid

  • Assuming you can raise more than £250,000 under SEIS when this is a lifetime company limit.
  • Believing the three-year trading window starts from company incorporation, instead of the first commercial sale.
  • Forgetting to account for previous SEIS funding when planning a new round; the £250,000 is a cumulative limit.
  • Thinking that investor limits mean your company can raise more than £250,000 in total.

What happens if an investor exceeds their £200,000 SEIS investment limit in a tax year?

Any investment exceeding the £200,000 limit won't qualify for SEIS income tax relief for that investor. The company will still receive the funds if the investment agreement is valid, but it might affect investor relations.

Does SEIS funding need to be spent immediately?

While there's no strict timeframe for spending SEIS funds after receiving them, HMRC expects the funds to be used for qualifying business activities within a reasonable period (typically within 3 years) from the date the shares were issued.

How does SEIS affect future funding rounds (e.g., Series A)?

Raising SEIS funding can make your company more attractive to future investors, particularly venture capitalists, as it demonstrates early validation and a proven ability to attract investment. However, ensure you maintain a clear cap table and manage investor expectations regarding future equity dilution.

What happens if I breach the SEIS rules after receiving investment?

If the company breaches the SEIS rules after receiving investment (e.g. becomes a non-qualifying trade), HMRC may withdraw the tax relief previously claimed by the investors. The company might also be liable for penalties.

Practical Tips

  • Create a detailed financial forecast showing how you intend to use the SEIS funds to achieve specific milestones; this helps convince investors.
  • Maintain meticulous records of all SEIS investments, including investor details, share certificates, and dates of investment; this is crucial for HMRC compliance.
  • Consult with an accountant experienced in SEIS before raising capital to ensure you meet all eligibility criteria and avoid unintentional breaches.
  • When pitching to investors, highlight the specific benefits they receive under SEIS (50% income tax relief, CGT exemption), to make your offering more attractive.

Related Questions

How much can I raise under EIS?

A company can raise up to £10 million per year under EIS, with a lifetime maximum of £24 million from all venture capital schemes combined (for shares issued on or after 6 April 2026). Knowledge-intensive companies can raise up to £20 million per year with a £40 million lifetime cap.

What is the difference between SEIS and EIS?

SEIS offers 50% income tax relief on investments up to £200,000 in very early-stage companies (under 3 years, under £250k raised), while EIS offers 30% relief on up to £1 million in slightly larger companies (under 7 years, up to £10 million raised per year).

What is the 70% spend rule for SEIS?

At least 70% of SEIS money raised must be spent on qualifying business activity before the company can raise further investment under EIS. This ensures SEIS funds are genuinely used for the qualifying trade, not just parked while seeking larger EIS funding.

Browse all questions →

Applying for SEIS or EIS advance assurance?

Finn builds the pack for HMRC's form from your company's records. You check it and submit it.

Get Started Free

Free for 14 days - No credit card required