Using a venture capital scheme to raise money

Your company must:

• have a permanent establishment in the UK
• carry out a trade that qualifies
• plan to spend the investment on a qualifying trade
• not be listed on a recognised stock exchange at the time of investment
• not be controlled by another company

You must also meet the specific qualifying conditions of whichever scheme you opt for.

Qualifying trades

You must use the investment for a qualifying trade.

Most trades will qualify, including any research and development which will lead to a qualifying trade.

However your company may not qualify if more than 20% of your trade includes things like:

• coal or steel production
• farming or market gardening
• leasing activities
• legal or financial services
• property development
• running a hotel
• running a nursing home
• generation of energy, such as electricity and heat
• production of gas or other fuel
• exporting electricity
• banking, insurance, debt or financing services

Find a full list of, and more information about non-qualifying trades in the HMRC manual.

Limits on the money you raise

There’s no minimum, but there’s a maximum amount you can raise depending on which scheme you opt for.

The maximum amount you can raise in the lifetime of your company for:

• Seed Enterprise Investment Scheme (SEIS) investments is £250,000
• Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) investments is £12 million

There may be higher limits if your company carries out research, development or innovation and meets certain conditions.