SEIS1 and EIS1 compliance statements

The SEIS1 and EIS1 compliance statements are the company's formal declaration to HMRC that the conditions of the scheme have been met for a specific share issue. They cover the shares issued, the amount raised, the date of issue, how the money has been used, and a confirmation that the company and its trade still satisfy the scheme's requirements.

You cannot file the moment the round closes. For SEIS, the company must have been carrying on its qualifying trade for at least four months before the statement can be submitted. Where an EIS issue follows an SEIS one, the EIS statement can also depend on at least 70% of the SEIS money having been spent.

At the other end, there is a hard limit: a statement generally cannot be submitted more than two years after the end of the tax year in which the shares were issued. Investors chasing you for certificates a year after the round is a very common and entirely avoidable situation.

HMRC checks that the shares are full-risk ordinary shares with no preferential rights, that they were paid up in cash at issue, that the funds have been or are being spent on the qualifying trade, and that nothing has happened since the share issue that breaks the conditions, such as a change of control, a new excluded activity, or a value received by an investor.

Mistakes here are more expensive than mistakes in an advance assurance application, because relief that has already been claimed can be withdrawn from your investors.

We prepare and file the compliance statement, deal with HMRC's queries, and then produce the investor certificates once approval comes back. The fee is £50 per investor in the round, covering both the statement and that investor's certificate.

When can we file the compliance statement?

Once the shares have been issued and the company has been trading for at least four months, or has spent at least 70% of the SEIS money where an EIS issue follows it.

Is there a deadline?

A compliance statement generally cannot be submitted more than two years after the end of the tax year in which the shares were issued, or two years after the end of the four-month trading period if that is later.

Can investors claim relief before this is filed?

No. Investors cannot claim until HMRC has approved the compliance statement and the company has issued them an SEIS3 or EIS3 certificate.