Changes to venture capital schemes

The measure

The government has announced a package of targeted changes to the Seed Enterprise Investment Scheme ('SEIS'), Enterprise Investment Scheme ('EIS') and Venture Capital Trusts ('VCTs'), which are intended to fix minor technical issues that can cause otherwise-qualifying investments to lose their tax relief. This follows the call for evidence, “Tax Support for Entrepreneurs”, launched at Autumn Budget 2025. 

The government confirmed in the outcome to the call for evidence that it will legislate in Finance Bill 2026/27 for a package of targeted changes that will: 

• ensure that exceeding an EIS investment limit does not automatically result in all tax relief being lost; 
• allow SEIS and EIS or VCT investment to take place on the same day; 
• prevent late payment by one or more investors from affecting the tax relief available to other investors; 
• align the SEIS rules on interest charged when relief is withdrawn or reduced with the equivalent EIS rules; and 
• ensure that any withdrawal of VCT income tax relief is calculated using the rate that applied when the shares were issued. 

Who will be affected?

Companies raising, or planning to raise, investment under SEIS, EIS or VCT, and the investors in those companies, including angel investors, VCT managers and fund managers.  

When will the measure come into effect?

The amendment to the VCT relief withdrawal rules will take effect for relevant disposals of shares issued on or after 6 April 2026. The rest of the changes will take effect for share issues on or after 6 April 2027.