UK EIS / SEIS Relief Calculator 2026/27: Worked Tax Saving Examples
EIS and SEIS relief 2026/27: 30% and 50% Income Tax relief, CGT exemption after 3 years, share loss relief and worked examples for success and failure.
Overview
The Enterprise Investment Scheme (EIS, 30% Income Tax relief on up to £1,000,000 a year) and the Seed Enterprise Investment Scheme (SEIS, 50% on up to £200,000 a year) give tax relief for buying new shares in qualifying early and growth-stage trading companies. Both offer Income Tax relief claimed through Self Assessment or a tax code change, no Capital Gains Tax on a sale after at least 3 years, and share loss relief against income if the company fails. Unlisted shares can also qualify for Inheritance Tax Business Relief after 2 years, subject to the £2.5m allowance from April 2026. See our full SEIS & EIS guide for the qualifying-company tests.
Worked relief scenarios
Five scenarios showing Income Tax relief, the CGT-free gain on a successful exit, and share loss relief if the company fails instead. Loss relief is shown at the investor's Income Tax rate on the net cost (rest-of-UK rates; it does not reduce National Insurance).
| Scheme | Investment | IT relief | Net cost | Exit multiple | Exit value | CGT-free gain | Loss relief (on failure) | Notes |
|---|---|---|---|---|---|---|---|---|
| EIS | £30,000 | £9,000 | £21,000 | 3x | £90,000 | £60,000 | £8,400 | Higher-rate (40%) taxpayer investing £30k in an EIS-qualifying company. 3x exit. |
| EIS | £50,000 | £15,000 | £35,000 | 5x | £250,000 | £200,000 | £15,750 | Additional-rate (45%) taxpayer investing £50k in EIS. 5x exit. |
| SEIS | £30,000 | £15,000 | £15,000 | 5x | £150,000 | £120,000 | £6,000 | Higher-rate taxpayer investing £30k in an SEIS-qualifying seed company. 5x exit. |
| SEIS | £100,000 | £50,000 | £50,000 | 10x | £1,000,000 | £900,000 | £22,500 | Additional-rate taxpayer investing £100k in SEIS (limit £200,000). 10x exit. |
| EIS | £100,000 | £30,000 | £70,000 | 0x | £0 | £0 | £31,500 | Failure: shares become worthless. No gain; share loss relief on the net cost. |
EIS / SEIS rates and limits summary
| Feature | EIS | SEIS |
|---|---|---|
| Income Tax relief | 30% | 50% |
| Annual investor limit | £1,000,000 (£2,000,000 if at least £1,000,000 is in KICs) | £200,000 |
| Minimum hold | 3 years | 3 years |
| CGT on sale (relief kept, held 3+ years) | Exempt | Exempt |
| Relief for gains reinvested | Deferral of any amount of gain | Exemption on 50% of the investment, so at most £100,000 |
| Loss relief | Net cost against income (Income Tax rate) or as a capital loss | Net cost against income (Income Tax rate) or as a capital loss |
| IHT Business Relief (2-year hold) | 100% within the £2.5m allowance from April 2026, 50% above | 100% within the £2.5m allowance from April 2026, 50% above |
| Carry-back | 1 year (previous tax year) | 1 year (previous tax year) |
Related calculators and guides
- SEIS & EIS guide - full structural detail and qualifying-company tests.
- CGT calculator - general UK CGT and EIS deferral interaction.
- UK CGT rules guide - rates, exemptions and BADR schedule.
- BPR/APR April 2026 changes - £2.5m allowance impact on EIS/SEIS BR.
- Dividend calculator - dividend tax for distributions from EIS-funded companies before exit.
- UK R&D Tax Credit guide - complementary company-level relief for EIS-funded R&D activity.
- Family Investment Companies (FIC) - post-exit wealth planning vehicle.
- Employee share schemes - EMI for founder/team equity at the same companies.
Frequently asked questions
How is EIS Income Tax relief calculated?
EIS relief is 30% of the amount you subscribe, on up to £1,000,000 a tax year (£2,000,000 if at least £1,000,000 of it goes into knowledge-intensive companies). It reduces your Income Tax bill and cannot exceed the Income Tax you owe for the year. Example: with £40,000 of Income Tax due, a £200,000 subscription gives only £40,000 of relief that year, not the headline £60,000. The £20,000 of relief left over (on about £66,667 of the subscription) cannot be carried forward, but you can elect to treat part of the shares as issued in the previous tax year and use that year's liability instead.
How is SEIS Income Tax relief calculated?
SEIS relief is 50% of the amount you subscribe, on up to £200,000 a tax year, so a £200,000 SEIS subscription can give £100,000 of relief against £60,000 for the same sum in EIS. SEIS is for very early companies: the trade must not have been carried on for more than 3 years, gross assets must not exceed £350,000 and there must be fewer than 25 full-time equivalent employees when the shares are issued. A company can raise at most £250,000 under SEIS.
What is the carry-back election and how does it work?
For both EIS and SEIS you can claim to treat all or part of a share issue as if the shares had been issued in the previous tax year, and the relief is then given against that year's Income Tax (ITA 2007 s.158(4) for EIS, s.257AB for SEIS). The previous year's annual limit still applies. It goes back one year only, and unused relief cannot be carried forward. A claim for the previous year is made on the Self Assessment return.
How does the 3-year hold rule work?
You need to keep the whole investment for at least 3 years to keep the full reliefs. You lose relief if in that time you sell some or all of the shares, the company stops meeting the scheme conditions, you become connected with the company, or you receive value from it, and you must tell HMRC within 60 days. On an arm's-length sale the relief is reduced by the sale proceeds multiplied by 30% (ITA 2007 s.209(3)). A transfer to a spouse or civil partner you live with does not count (s.209(4)), and nor does a disposal on death (s.209(6)).
What is the loss relief mechanism on failure?
If you dispose of EIS shares at a loss, you can set the loss, less the Income Tax relief already given, against your income for the year of the loss or the year before (share loss relief, ITA 2007 s.131), or use it as a capital loss. Against income it saves your marginal Income Tax rate, at most 45%. It does not reduce National Insurance. Example: a higher-rate taxpayer invests £30,000, gets £9,000 of EIS relief, so the net cost is £21,000. If the company fails, £21,000 at 40% saves £8,400, leaving a net loss of £12,600, or 42% of the amount invested.
How does the CGT exemption work?
You pay no Capital Gains Tax when you sell EIS or SEIS shares if you received Income Tax relief that has not been reduced or withdrawn and you held the shares for at least 3 years. Example: a £30,000 EIS investment sold for £90,000 makes a £60,000 gain with no CGT; on an ordinary shareholding the same gain taxed at the 24% higher rate would cost £14,400, before the annual exempt amount. Separately, EIS deferral relief lets you defer a gain on any asset by investing in EIS shares between 1 year before and 3 years after the gain arose.
What is the EIS knowledge-intensive company higher limit?
You can invest up to £2,000,000 a year under EIS if at least £1,000,000 goes into knowledge-intensive companies (ITA 2007 s.252A). A KIC must have fewer than 500 full-time equivalent employees and have spent at least 15% of operating costs on research, development or innovation in one of the last 3 years, or 10% a year for 3 years. It must also either be creating intellectual property or have 20% of employees doing research in roles that need a relevant Masters or higher degree. KICs can raise EIS money within 10 years of first commercial sale (7 for other companies) and, from 6 April 2026, up to £20m a year and £40m in total (£10m and £24m for other companies).
Can I combine EIS deferral relief with the Income Tax relief?
Yes. They are separate reliefs and can be claimed on the same shares. The Income Tax relief is 30% of the subscription. Deferral relief is claimed against a chargeable gain you reinvest in EIS shares within the window from 1 year before to 3 years after the gain. The deferred gain comes back into charge later, for example when the EIS shares are disposed of: it is a deferral, not an exemption. Deferral relief is available even where Income Tax relief is not, because you are connected with the company.
How does the £30,000 EIS example actually save tax?
A higher-rate taxpayer invests £30,000 in EIS shares and gets £9,000 of Income Tax relief, so £21,000 is at risk. (1) A 3x exit at £90,000: the £60,000 gain is CGT-free, against £14,400 at 24% on an ordinary holding. Net profit is £69,000 on £21,000 at risk, a 328.6% return. (2) A 1.5x exit at £45,000: the £15,000 gain is CGT-free and the relief is kept. (3) Failure: share loss relief of £8,400 leaves a net loss of £12,600.
How do I make a SEIS or EIS investment?
You can subscribe directly for new shares in a qualifying company, or invest through a fund. Before you can claim, the company must send you a compliance certificate (SEIS3 or EIS3); for an approved knowledge-intensive fund the fund manager sends form EIS5. HMRC does not issue these to investors. A company can only submit its compliance statement once it has carried on the qualifying activity for 4 months. Some companies get advance assurance from HMRC first, but that covers only some of the conditions.
What are the risks?
EIS and SEIS companies are small, early-stage businesses, and many fail. The main tax risks are that relief is withdrawn if you sell within 3 years, if the company stops meeting the scheme conditions, or if you become connected with it. The shares are usually unquoted and hard to sell before an exit. Share loss relief reduces a loss but does not remove it. Consider regulated financial advice before investing.
How does IHT Business Relief interact?
Shares in an unlisted company can qualify for Business Relief once owned for at least 2 years. From 6 April 2026 the 100% rate applies only to the first £2.5 million of combined business and agricultural property, with 50% relief above that, and unused allowance can pass to a surviving spouse or civil partner. EIS and SEIS holdings count towards that allowance alongside any other qualifying business or agricultural property. See our BPR/APR April 2026 changes guide.