SEIS reinvestment relief claim

If you make a capital gain you can reduce or eliminate any capital gains tax (CGT) payable by purchasing shares in a seed enterprise investment scheme (SEIS) company.

Gains

CGT is payable on gains made from the sale or transfer of chargeable assets, e.g. land, buildings, shares. However, SEIS offers the opportunity to reduce the tax through reinvestment relief. This works by matching up to 50% of your qualifying investment. The allowable amount is capped at 50% of the gain though, even if 50% of the investment is more than that amount.

details

SEIS reinvestment relief applies to gains made in the same tax year that SEIS income tax relief is allowed. This means if you claim for income tax relief to be allowed in the year previous to that in which you made the SEIS investment, the CGT reinvestment relief automatically applies for that year too.

Procedure

You can claim relief on your tax return, but you can’t do this until you receive your SEIS certificate from the company. If you have already sent your return, you can either amend it or send the claim in writing using the form that comes with the certificate. Use our template letter to accompany this and make it clear to HMRC which gains you are exempting.

The time limit for making a claim is the fifth anniversary of 31 January following the end of the tax year the claim is for, e.g. by 31 January 2029 for a claim in relation to 2022/23.