The Times reports that Joanna Jensen, chairwoman of the Enterprise Investment Scheme Association, has urged Chancellor Rachel Reeves to protect the EIS & SEIS tax schemes. These encourage investors to back young companies. The Enterprise Investment Scheme (EIS) provides income and capital gains tax reliefs to investors. The purpose is to encourage them to risk capital in early-stage businesses.

Ms Jensen warns that the schemes are under threat. Currently the EU must approve extension of their use beyond April 5, 2025. A sunset clause was imposed when the EIS scheme came into use. Ms Jensen says “ministers must ensure that it is renewed, regardless of what the EU says.” She pointed out that the EIS and Seed Enterprise Investment Scheme (SEIS) have helped raise £32bn for 56,000 businesses. A spokesperson for the Treasury said discussions with the EU are at an advanced stage. “We are a government of wealth creation. We are committed to supporting start-ups to raise the capital they need to invest and grow our economy.”

BFS Comment:

Ms Jensen is right that continuation of the EIS and SEIS schemes are vital to encourage future investment into startups and early-stage SMEs. If you want to know more about these schemes or need help in formulating an application call us on 07770 866 955 or complete our enquiry form.