SEIS and EIS Advance Assurance: what is it?

SEIS/EIS Advance Assurance is approval from HMRC that an investment in your company is likely to qualify for tax relief.

Advance Assurance does not guarantee that your investment will meet the conditions, but you can use it to attract investors by showing investors your proposed investment is likely to qualify.

In this post, we explain what Advance Assurance is, why it’s a good idea to have it if you’re fundraising, and how to apply.

Contents

• Is Advance Assurance a legal requirement?
• How to apply for SEIS / EIS Advance Assurance
• What are the criteria for obtaining Advance Assurance?
  What documents do I need to submit?
• Where do I send the Advance Assurance application?
• How long does Advance Assurance last?
• When should I apply for SEIS/EIS Advance Assurance?
• How long does HMRC take to approve SEIS Advance Assurance?
• Talk to an expert

Is Advance Assurance a legal requirement?

Advance Assurance is not a legal requirement to qualify for the Enterprise Investment Schemes (SEIS and EIS) or to bring investors onboard.

But Advance Assurance is a way to make your company more investable. With the Assurance, your investors can be more confident that an investment in your company is likely to give them the generous SEIS/EIS tax breaks many investors look for.

SEIS/EIS Advance Assurance isn’t a guarantee that investments in your company will qualify for tax relief. It’s proof that if nothing changes for the company, and your deal documents for the SeedFAST or funding round are in line with the documents shown to HMRC when you applied for Advance Assurance, then the investment should qualify.

And Advance Assurance can’t tell you if the investors themselves will be eligible for SEIS/EIS tax relief.

If it helps, you can think of Advance Assurance as an assurance that the investment is not disqualified.

How to apply for SEIS / EIS Advance Assurance

You can apply online at the gov.uk website.

Want expert help and a speedy response from HMRC? Apply for SEIS/EIS Advance Assurance on SeedLegals. When your pitch deck and documents are ready, we take the admin off your hands and handle everything with HMRC for you, from start to finish.

We’ll guide you at every step and we’re here to answer your questions. Our expert team completes more SEIS/EIS Advance Assurance applications than any other organisation in the UK. This expertise is reflected in our 98% approval rating – the industry average is only 62%.

To find out more about how it works, book a free call with one of our SEIS/EIS experts.

What are the criteria for obtaining Advance Assurance?
What documents do I need to submit?

To apply for Advance Assurance, you must meet the eligibility criteria for the Seed Enterprise Investment Scheme or the Enterprise Investment Scheme.

When you’ve confirmed that your company is eligible, you’ll need to demonstrate that you fulfil the criteria. For SEIS, this includes:

• trading start date
  Have to hand the date your company started trading. We explain what this means in our post: What is ‘trading’ for SEIS or EIS?
• previous SEIS investments
  Give details of any SEIS investments you’ve received
• your response to the risk to capital condition
  Usually this will be a brief SWOT analysis. We explain more about this in our post, What is the SEIS / EIS ‘risk to capital’ condition?
• details of one potential investor
  If you haven’t already received any funding under a Venture Capital Scheme (SEIS and EIS are types of Venture Capital Scheme), you’ll need to give the name, address and intended amount of investment of at least one potential investor.
  This criterion takes some applicants by surprise – it’s designed to deter speculative applications. The person you list doesn’t have to invest but you must list a bona fide investor.
  We explained more about this in our post: When to include an investor in your Advance Assurance application
  If your proposed investor is an SEIS/EIS fund or a crowdfunding platform, you’ll need a letter of engagement from them.

You’ll also need these supporting documents:

• Bank statements / accounts
  You’ll need PDFs of your most recent company bank statements and/or accounts filed with Companies House, if you have them
• Articles of Association
  Find the up-to-date documents for your company. If your company is using the Model Articles of Association, you don’t need to submit them in your application.
• Pitch deck
  This can be the same as the pitch deck you show potential investors, as long as it includes all the information we’ve listed in our post, What to include in your SEIS/EIS business plan / pitch deck and in your SEIS/EIS application, you show how you satisfy the risk to capital condition.
• Financial forecast
  Submit your profit and loss forecast for three years from the date of your application and show why you need the investment. You can include this in the pitch deck.
• Share Register
  If you complete your Advance Assurance on SeedLegals, this will be automatically included in your document pack if you’ve set up your Cap Table.
• Documents confirming any de minimis aid
  Not sure if grants or investment you received is de minimis aid? Find out more in our post

Where do I send the Advance Assurance application?

Submit your application at the gov.uk website, or if you’re applying via SeedLegals we act as your agent to submit on your behalf.

How long does Advance Assurance last?

Your Advance Assurance doesn’t have an expiry date but it will lapse if there are any changes to your company’s situation that make it no longer eligible for SEIS/EIS investments.

However, there are some circumstances in which your Advance Assurance would appear to be invalid – but you can continue to raise with the Enterprise Investment Schemes. We’ve explained more in our post: Does SEIS/EIS Advance Assurance expire?

When should I apply for SEIS/EIS Advance Assurance?

As a general rule, we recommend you apply for Advance Assurance at least one to two months before you start approaching investors. This gives HMRC time to approve your application.

How long does HMRC take to approve SEIS Advance Assurance?

It usually takes HMRC between 15 and 45 working days to approve an SEIS/EIS Advance Assurance application.

Applications via SeedLegals are usually approved much faster, usually in two to three weeks because we make sure your application presents exactly the information HMRC needs, in their preferred format.

Talk to an expert

Got questions about SEIS/EIS? We’ve helped thousands of companies obtain Advance Assurance and our SEIS/EIS experts are here to help you. To message us, hit the chat button (at the bottom right of your screen).