The service is invaluable for start ups as it provides an effective way to get your investment rounds started for just £300 plus VAT.
Once you know your business qualifies for SEIS and EIS talk to us as we can quote for managing the funding rounds and adapting your articles.
The Seed Enterprise Investment Scheme (SEIS) is a UK government initiative run by HMRC designed to help start ups raise funds by rewarding investors with tax relief. SEIS is the most generous of initiatives run by HMRC designed to encourage start ups by offering substantial tax savings to investors in recognition of risk. Tax relief is given to investors twice – upon subscription and then again upon disposal.
We offer a starter pack discussed below to give your investors a steer on whether the business will qualify for SEIS tax relief. This is helpful for encouraging investment.
SEIS Scheme – the basics
You need to think about:
- The company – are the company’s eligibility requirements for SEIS met?
- The investor – will he/she/they qualify for SEIS tax relief?
- SEIS practicalities – how do you know if HMRC will approve claims for SEIS tax relief?
Key points to note
Some of the most important things to know about an SEIS Scheme iinclude :-
- SEIS generates an immediate tax saving for the investor – Investors benefit from tax relief of 50% on their investment. So, if an investor invests £30,000 under SEIS – the investor receives a tax refund from HMRC of £15,000.00 for the tax year the money is invested. The tax relief is higher than the 30% limit under EIS.
- What happens when the SEIS shares are sold? – When the shares are sold there is further tax relief as profits are free of capital gains tax. So if the shares are sold for say £30,000.00 there is a tax saving of £6,000.00 compared with the capital gains tax bill for non-SEIS shares.
- Qualification for SEIS – Not all companies or businesses can qualify for EIS as there are requirements around the company’s size and status. The company must have been trading for less than 7 years, cannot be a subsidiary of another company (where that other company holds more than 50% of the shares in the company), cannot raise more than £5m in total over a 1 year period and the funds raised must be used for trades approved under the legislation. Trades such as property and finance are prohibited for SEIS purposes. In cases of grey areas we can approach HMRC and seek their views.
Our SEIS starter package
We offer starter packages at £300.00 plus VAT for start-ups. We take you through the HMRC process and help you complete your application form. Many businesses seek approval from HMRC to offer SEIS and EIS as part of one application and our starter pack caters for that.
The starter package covers the basics and assumes the trade and business qualifies for SEIS/EIS- the details are set out here. We are more than happy to deal with specific technical questions but that will be quoted and charged separately. When you work with Gannons you have the quality assurance offered by regulation under the rules of the Solicitors Regulation Authority backed up by compulsory insurance. But there are providers who are not regulated and may therefore appear cheaper.
What the SEIS fixed fee includes
- Step-by-step guide with telephone support with one of our SEIS experts
- Template HMRC Advance Assurance Letter
- Checklist for your email to HMRC
- You will need to provide to us your business plan or pitch deck for review.
Once you receive HMRC approval we are able to help with fund raising. We have put together a starter pack which starts at £650 plus VAT and provides you with everything you need for your investors and HMRC.
Catherine is an extremely experienced solicitor, having been qualified since 2000, and deals with all types of corporate and commercial matters and advice and also tax law.
Catherine is well known for turning complex problems into solutions, priding herself on always finding a way. In her spare time she runs Gannons!