Enterprise Investment Scheme (EIS)

Enterprise Investment Scheme (EIS) — Company Certification

Offers United Kingdom startups with certification support tied to investor incentive access for high growth innovation.

The Enterprise Investment Scheme (EIS) is an HMRC-administered venture capital scheme enabling qualifying UK companies to raise equity investment from individual investors who receive substantial tax reliefs: 30% Income Tax relief on the amount invested, Capital Gains Tax deferral, and loss relief if the investment fails. The company — not the investor — applies to HMRC for certification. Companies can raise up to £10 million across EIS, SEIS, VCT, and other risk-finance state aid instruments in any rolling 12-month period, and up to £24 million over the company's lifetime. Knowledge-Intensive Companies conducting significant R&D may raise up to £12 million annually. Northern Ireland companies trading in goods or the wholesale electricity market are subject to lower limits of £5 million annually and £12 million lifetime under Windsor Framework state aid rules, updated April 2026.

Company eligibility conditions include: fewer than 250 full-time equivalent employees at share issue, gross assets of no more than £30 million before share issue (£35 million immediately after), a permanent UK establishment, and being within seven years of first commercial sale (ten years for Knowledge-Intensive Companies). The company must carry out a qualifying trade and meet the risk-to-capital condition — demonstrating intent for long-term growth and genuine risk of capital loss to investors. Shares issued must be full-risk ordinary shares, paid up entirely in cash at issue, not redeemable, and must carry no special asset rights. Investors must hold shares for at least three years; early disposal triggers clawback of tax relief from the investor's personal tax account.

The application process begins with an optional Advance Assurance request to HMRC before shares are issued. After at least four months of qualifying trading activity, the company submits a Compliance Statement (form EIS1) to HMRC. HMRC then issues form EIS3 — a compliance certificate carrying a unique investment reference — directly to each investor, who uses it to claim the Income Tax relief through self-assessment. HMRC must be contacted via the Enterprise Centre at enterprise.centre@hmrc.gov.uk; detailed scheme rules are in the Venture Capital Schemes Manual from VCM10000. The three-year holding rule must be actively monitored, as any scheme breach during this window automatically withdraws investor relief.