HMRC has published the latest guidance on the above scheme which was legislated in Finance Act 2012 and applies to shares issued on or after 6 April 2012.

By way of reminder, the SEIS is designed to help small, early-stage companies to raise equity finance by offering a range of tax reliefs to individual investors who purchase new shares in those companies. It is designed to complement the existing Enterprise Investment Scheme which will continue to offer tax reliefs to investors in higher-risk small companies. The rules have therefore been designed to mirror those of EIS as it is anticipated that companies may want to go on to use EIS after an initial investment under SEIS.

SEIS is intended to recognise the particular difficulties which very early stage companies face in attracting investment, by offering tax relief at a higher rate than that offered by the existing EIS.

Briefly, relief is available at 50% of the cost of the shares, on a maximum annual investment of £100,000. The relief is given by way of a reduction of tax liability, providing there is sufficient tax liability against which to set it. The updated SEIS guidance is available from www.hmrc.gov.uk