SEIS and EIS advance assurance: how to apply and what to prepare

Advance assurance is HMRC's view, given before you issue any shares, that a planned SEIS or EIS investment is likely to qualify for tax relief. It is not compulsory, but most angel investors expect it before they commit. This guide explains what it is, who can apply, what HMRC asks for and what to get right first.

What advance assurance is, and what it is not

Advance assurance tells you and your investors that, on the information you gave HMRC, the share issue is likely to qualify. GOV.UK is clear that it should not be read as a wider endorsement of the company or any indication of how the investment will perform.

It also does not guarantee relief. The conditions still have to be met when the shares are issued and throughout the qualifying period. Investors can only claim once the company has submitted its compliance statement and issued certificates. Our SEIS vs EIS guide covers those later steps.

Who can apply

The company secretary, a director or an authorised agent, such as an accountant, can apply. Applications are made through the online form on GOV.UK, using the company's sign-in details for the online service.

What HMRC asks for

Expect to provide:

  • The amount you plan to raise
  • A business plan and financial forecasts
  • Your latest accounts, if you have them
  • Details of the company's trade and a breakdown of how the money will be spent
  • Your current articles of association and register of members
  • Drafts of the investor documents, including any shareholder or investment agreement
  • Names and addresses of prospective investors, with some exceptions such as investment through certain platforms or fund managers
  • Information showing how the investment meets the risk to capital condition

The full list and the online form are on GOV.UK: Venture capital schemes: apply for advance assurance.

Get these right before you apply

  • Make the documents agree with each other. The business plan, forecasts, use of funds and investor documents should tell one consistent story.
  • Check the share rights. Some preferences and other rights can stop shares qualifying. Check the articles and the draft investor documents before you submit, not after.
  • Be clear about the money. HMRC wants to see that the funds will be spent on the qualifying trade and aimed at growing the business, with a real risk to the investor's capital.
  • Plan SEIS and EIS together. If you plan to use both in one round, decide the order and timing first.
  • Start early. Investors will want assurance in place before they commit, and you should not assume how long HMRC will take.

What happens next

With advance assurance in place, investors can commit with more confidence. You then issue the shares, submit the SEIS1 or EIS1 compliance statement once the conditions are met, and issue SEIS3 or EIS3 certificates after HMRC authorises the claim.

How Elm can help

We prepare advance assurance applications, including the forecasts and use-of-funds explanation that HMRC and investors expect. We also handle the compliance statements and investor certificates afterwards, and the share issue paperwork through our company secretarial service. See our support for founders or talk to us about finance director support for the fundraise.

Joe Gilbert ACMA CGMA
This guide is general information, not tax advice for your company.
Talk to us about advance assurance