How to apply for seis and eis advance assurance

Applying for Advance Assurance is the single most effective way to make your startup "investor-ready" in the UK. It is a formal statement from HMRC confirming that, based on the information you provide, your company qualifies for the Seed Enterprise Investment Scheme (SEIS) or the Enterprise Investment Scheme (EIS). For investors, this means they can potentially offset a huge chunk of their investment against their tax bill, making your business a far more attractive prospect than one without this assurance.

Understanding the Schemes

Before applying, you need to know which scheme you are targeting, though you can apply for both at once if you are planning multiple funding rounds.

• SEIS (Seed Enterprise Investment Scheme): Designed for very early-stage companies. Investors can claim up to 50% income tax relief on investments up to £200,000.
• EIS (Enterprise Investment Scheme): Targeted at slightly larger or scaling companies. Investors can claim 30% income tax relief on investments up to £1 million per year.

What You Need to Prepare

HMRC requires a clear paper trail to prove your business is a genuine, high-growth venture. Before starting the online application, ensure you have the following documents ready:

1. Business Plan and Pitch Deck: This should clearly explain what your business does, your market, and how you intend to grow.
2. Financial Forecasts: Provide a three-year projection showing how the investment will be used to grow the business.
3. Articles of Association: HMRC will check these to ensure there are no "preferential rights" (like guaranteed dividends) that disqualify the shares from the scheme.
4. The "Risk to Capital" Statement: This is a crucial written explanation of why the investment carries a significant risk of loss and how the company aims to grow and develop in the long term.
5. Details of at least one potential investor: HMRC generally won't provide assurance unless you can name at least one person or funder interested in investing.

The Application Process

The application is handled through the HMRC online service. You will need your business's Government Gateway user ID and password to log in. The form will guide you through questions regarding your company structure, your trade, and any previous funding received. Once completed, you will upload your supporting documents as PDF files.

Action Tip: Be explicit in your 'Risk to Capital' explanation. HMRC wants to see that you aren't just a safe "shell" for capital; they want to see that the money is being used for genuine innovation and scaling.

Timeline and Next Steps

Once submitted, it typically takes HMRC between 15 to 45 days to review your application. If successful, you will receive a letter of Advance Assurance. You can then include this in your investor deck to provide peace of mind to your backers. Note that the assurance is valid as long as the facts of your business do not change significantly before the investment is made.