In 2025, the UK’s Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS) continue to play pivotal roles in fostering innovation and supporting early-stage companies. Recent developments have further solidified their importance in the entrepreneurial ecosystem.
Extension of EIS and VCT Schemes
In September 2024, the UK government announced a significant extension of both the EIS and the Venture Capital Trust (VCT) scheme. Originally set to conclude in April 2025 due to a sunset clause, both schemes have been extended by ten years, now set to end on 5 April 2035. This move aims to provide stability and encourage continued investment in early-stage businesses, thereby stimulating economic growth.
Enhancements to SEIS
The SEIS has undergone notable enhancements to broaden its accessibility and impact:
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Increased Investment Cap: From April 2023, the maximum amount a company can raise under SEIS increased to £250,000, a two-thirds rise from the previous limit.
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Expanded Eligibility Criteria: Companies can now qualify for SEIS if they have been trading for up to three years (previously two years) and possess gross assets up to £350,000, up from the prior £200,000 limit.
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Higher Investor Limit: The annual investment limit for individuals has doubled to £200,000, encouraging more substantial backing for emerging businesses.
These changes are designed to support over 2,000 companies annually, facilitating their growth and development.
Industry Perspectives
The extension of these schemes has been met with approval from industry leaders. Michael Moore, Chief Executive of the British Private Equity & Venture Capital Association (BVCA), emphasized that the ten-year extension provides the long-term security needed to drive investor confidence. He noted that EIS and VCT play vital roles in supporting early-stage companies with high growth potential.
Similarly, Richard Stone, Chief Executive of the Association of Investment Companies, highlighted that extending the VCT scheme until 2035 will allow the sector to raise further capital and invest with confidence, ensuring support for the government’s ambitions to grow the economy, support innovation, and create jobs.
Looking Ahead
As of 2025, the EIS and SEIS remain integral to the UK’s strategy for nurturing entrepreneurship and innovation. The recent extensions and enhancements reflect a commitment to providing early-stage companies with the necessary support to thrive, ensuring that the UK remains a competitive environment for start-ups and investors alike.
