Will the investor qualify for the scheme?

Investors who are connected to the company are not eligible for Income Tax relief on SEIS or EIS investments. The connection can be defined in two ways:

1. Connection by Financial Interest

• An individual is connected to a company if they control or own more than 30% of the issued share capital or voting rights
• These conditions apply to 2 years before and 3 years after the investment is made
• All shares owned by business partners and direct relatives (excluding brothers and sisters) are included in these restrictions

2. Connection by Employment

• Employees of a company are connected to it and therefore ineligible (note that Directors are not deemed to be employees for this purpose under SEIS rules)
• These conditions apply to 2 years before and 3 years after the investment is made