Seed Enterprise Investment Scheme (SEIS) Qualifying Trade

The Seed Enterprise Investment Scheme (SEIS) has been in operation for three years now, and has assisted numerous young start-ups with sourcing vital investment where none would previously have been forthcoming.

One grey area for entrepreneurs however, seems to be regarding which trades qualify for the SEIS. Here we have compiled a list of qualifying trades based in the most recent published guidelines by HMRC:

Firstly, a qualifying trade falls under the category of a commercial venture, which looks to make profit long term.

The vast majority of profit-making trades do qualify, but there are some exceptions. If in excess of 20% of a business’ activities involves work in any of the following trades, the entire business is ineligible for SEIS:

  • Property development
  • Agricultural businesses (farming or market-gardening)
  • Dealing in land, commodities or future in stocks, shares, securities or financial products
  • Dealing in goods other than standard retail or wholesale distribution
  • Leasing or letting assets for hire, except ship chartering
  • Receiving royalties or licence fees
  • Legal or accounting services
  • Forestry or timber production
  • Coal mining or production
  • Steel production
  • Shipbuilding
  • Running hotels, or any similar properties such as nursing or care homes
  • Generating or exporting electricity
  • Providing a service to any business trading in one of these activities

Good Business

Some of the more popular industries utilising SEIS to source early-stage funding are:

  • Tech
  • Online marketplaces
  • Biotech
  • Mobile App development
  • Medical research
  • Independent film
  • Charities/non-profit
  • Pubs and restaurants

If you want to find out whether your business qualifies, you can make the initial approach to your Small Company Enterprise Centre (SCEC) to enquire.

SEIS is an increasingly popular method for companies to get themselves established within their industry, and with the tax breaks offered to investors being so generous, there is a queue of interested parties waiting to invest in the right projects.

For a comprehensive look at SEIS from both the investor and the entrepreneurial point of view. A Guide to the Seed Enterprise Investment Scheme is available for download at SEIS.co.uk

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