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Tax Bite – April 2026 EIS changes

This Tax Bite is a reminder of the welcome increases in EIS limits announced in the Autumn Budget, which took effect from 6 April 2026. From this date, the investment limits for EIS have roughly doubled, bringing larger and more mature businesses into the scheme and allowing qualifying companies to raise significantly more tax-advantaged capital.

The EIS annual and lifetime investment limits and the gross assets test have all increased:

• companies can now raise up to £10 million per year (previously £5 million), or £20 million (previously £10 million) for knowledge-intensive companies (KICs);
• the lifetime cap for a company on venture capital fundraising has increased to £24 million (up from £12 million), or £40 million for KICs (up from £20 million). So companies that previously hit the old cap may now have additional headroom; and
• the gross assets limit increases to £30 million pre-investment (was £15 million) and £35 million post-investment (was £16m), opening the scheme up to more scale-up businesses.

The investor tax reliefs (30% income tax relief, full CGT exemption on sale, loss relief, and CGT deferral) are all unchanged, so EIS remains very attractive from a tax efficiency perspective.

The Autumn Budget made no changes to SEIS, so the position remains as it has been since April 2023. Companies can raise up to £250,000 by way of SEIS investment, the company’s gross assets must not exceed £350,000 before the investment, and individual investors can invest up to £200,000 per year and claim 50% income tax relief.

The EIS and SEIS sunset clauses have both been extended to 6 April 2035, removing the near-term uncertainty that had hung over the schemes.

Whilst mentioning the Autumn Budget, it is also worth noting that as part of the wider business property relief (BPR) and agricultural property relief (APR) reforms also taking effect this month, the 100% BPR available on shares in qualifying EIS and SEIS companies is now capped at £2.5 million (total BPR and APR qualifying assets) per individual. Total BPR and APR qualifying assets above that threshold attract 50% relief rather than 100%, although the £2.5m allowance is transferrable between spouses.

The key point for advisers is that companies that previously fell outside EIS because they were too large or had come up against the limits on qualifying fundraising should now reassess whether they qualify. As always with SEIS and EIS however, detailed advice on qualification, implementation and sequencing of steps is crucial to ensure that the (numerous and in many cases not at all obvious!) pitfalls are avoided.