Equity Crowdfunding and EIS/SEIS Tax Relief: Investing Through Platforms 2026

Equity crowdfunding has opened startup investing to ordinary savers, and the UK's Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS) have made many of those investments substantially more attractive on a tax-adjusted basis. Platforms such as Crowdcube, Seedrs, and others regularly feature campaigns where investors can claim 30% or even 50% Income Tax relief, CGT exemptions, and Loss Relief on their stakes.

But the tax reliefs come with strict conditions and real risks. This guide explains how EIS and SEIS work in the context of equity crowdfunding in 2026/27, what the reliefs are worth, and what investors need to check before committing capital.

What Is Equity Crowdfunding?

Equity crowdfunding allows companies to raise capital from a large number of individual investors via online platforms, with each investor receiving shares in return. Unlike rewards-based crowdfunding (where you get a product or perk), equity crowdfunding gives you an ownership stake in the business.

The key platforms in the UK include:

• Crowdcube — one of the largest UK platforms, with many EIS-eligible raises.
• Seedrs (now part of Republic) — focuses on early-stage and growth companies.
• SyndicateRoom — often co-invests alongside institutional lead investors.

Most platforms conduct due diligence on companies before listing them, but the depth of that due diligence varies considerably. Investors should always read the full investment memorandum.

The Enterprise Investment Scheme (EIS)

What Is EIS?

EIS is designed to encourage investment in small, higher-risk trading companies by offering a package of tax reliefs to investors. It is available on investments in unquoted UK companies that meet HMRC's qualifying conditions.

EIS Tax Reliefs in 2026/27

Income Tax relief: 30% You can claim 30% of the amount invested against your Income Tax bill in the tax year of investment, or carry it back to the previous tax year. The maximum investment qualifying for Income Tax relief is £1 million per tax year, rising to £2 million if at least £1 million is invested in qualifying knowledge-intensive companies (KICs). This gives a maximum Income Tax reduction of £300,000 (or £600,000 for KICs).

You must have sufficient Income Tax liability to absorb the relief — it cannot create a repayment beyond your tax bill.

CGT exemption Any gain on disposal of EIS shares is exempt from Capital Gains Tax if:

• You have held the shares for at least three years; and
• The Income Tax relief was not withdrawn (e.g., because the company lost qualifying status).

CGT deferral You can defer CGT arising on the disposal of any asset by reinvesting the gain into EIS-qualifying shares within one year before or three years after the disposal. The deferred gain becomes chargeable when you dispose of the EIS shares.

Loss Relief If EIS shares are disposed of at a loss, you can claim Loss Relief. The loss is calculated after deducting the Income Tax relief received. The resulting loss can be set against:

• Income in the same or preceding tax year (Income Tax Loss Relief); or
• Capital gains in the current or future years.

For a higher-rate taxpayer who invested £10,000, received £3,000 Income Tax relief, and lost everything, the effective loss is £7,000. At 40% Income Tax Loss Relief, that yields a further £2,800 reduction — meaning the total effective loss from a £10,000 investment is only £4,200.

EIS Company Conditions

Companies must meet strict HMRC conditions to be EIS-qualifying:

• Unquoted (not listed on a recognised stock exchange; AIM counts as unquoted for EIS purposes).
• Gross assets must not exceed £15 million before the investment and £16 million immediately after.
• Fewer than 250 full-time equivalent employees (500 for KICs).
• Must not be in a disqualifying trade: property development, financial services, hospitality, and some energy activities are excluded.
• Must use the investment in a qualifying trade within two years of the investment.

The Seed Enterprise Investment Scheme (SEIS)

What Is SEIS?

SEIS targets even earlier-stage companies than EIS — typically pre-revenue or very early revenue startups. In exchange for the higher risk, the Income Tax relief rate is higher.

SEIS Tax Reliefs in 2026/27

Income Tax relief: 50% Investors can claim 50% of the amount invested against their Income Tax bill, up to a maximum investment of £200,000 per tax year. The maximum Income Tax reduction is therefore £100,000 per year.

CGT exemption Gains on SEIS shares held for at least three years are exempt from CGT, subject to Income Tax relief not having been withdrawn.

CGT reinvestment relief Investors who dispose of any asset and reinvest up to 50% of the gain into qualifying SEIS shares can exempt that reinvested portion from CGT. This is different from EIS deferral — for SEIS, the gain is effectively forgiven rather than deferred.

Loss Relief The same Loss Relief rules as EIS apply to SEIS investments.

SEIS Company Conditions

SEIS conditions are tighter than EIS, reflecting the earlier stage of investment:

• Gross assets must not exceed £350,000 before the investment.
• Fewer than 25 full-time equivalent employees.
• The company must have been trading for fewer than three years (or two years for companies carrying on R&D before trading).
• The maximum an individual company can raise under SEIS is £250,000 in total.

How to Claim EIS and SEIS Relief

The EIS3 and SEIS3 Certificates

After investment, the company issues an EIS3 (for EIS) or SEIS3 (for SEIS) compliance certificate once HMRC has confirmed compliance. This certificate is required to make the claim. It is typically issued several months after the investment closes — sometimes up to a year — which can delay tax relief claims.

Claiming via Self Assessment

The relief is claimed on the Self Assessment tax return for the relevant tax year. Enter the amount invested and the certificates you have received in the EIS/SEIS sections. HMRC will reduce your tax bill accordingly.

Carry-Back

Both EIS and SEIS allow you to carry back relief to the previous tax year, which is useful if you have already filed your previous return and want to accelerate the tax benefit. Carry-back is subject to the annual investment limits.

Risks and Considerations

High Failure Rate

Most startups fail. HMRC's own research suggests the majority of EIS and SEIS companies do not return capital to investors. The tax relief mitigates losses but does not eliminate them. Even with full Income Tax and Loss Relief, investors in failed companies will typically lose money.

Illiquidity

Equity crowdfunding shares are illiquid. There is no active secondary market for most crowdfunded shares, meaning you may be unable to exit your position for many years — or at all. The three-year holding period for CGT exemption is a minimum, not a typical exit timeline.

Advance Assurance Is Not a Guarantee

Many campaigns display HMRC advance assurance confirming that the company appears to meet EIS or SEIS conditions at the time of the application. This is not a guarantee that relief will be available — if the company later breaches the conditions (for example, by changing its trade or being acquired), HMRC can withdraw the relief and require repayment of Income Tax claimed.

Platform Risk

Crowdfunding platforms themselves can fail. Shares held via a platform nominee are generally protected by the nominee structure, but investors should understand how their shares would be managed in a platform insolvency.

The Bottom Line

Equity crowdfunding through EIS and SEIS offers one of the most tax-efficient ways to invest in early-stage UK companies, with Income Tax relief of 50% (SEIS) or 30% (EIS), CGT exemptions after three years, and Loss Relief that softens the blow of failures. The reliefs are genuinely powerful, but they exist precisely because these investments are high-risk and illiquid. Always verify the advance assurance letter, read the full investment memorandum, diversify across multiple companies to spread risk, and treat any capital invested as money you may not get back. The tax relief is a meaningful cushion — not a safety net.