SEIS1 & EIS1 Compliance Statements
for SEIS founders

The SEIS1 (and its EIS sibling, the EIS1) is the formal HMRC declaration that turns a share issue into actual investor relief. Until HMRC approves the SEIS1, the SEIS investors hold shares but cannot claim 50 percent income tax relief on their personal returns. Most founders underestimate how operationally important the SEIS1 is until the first investor follows up asking when their certificate is coming.

Filing the SEIS1 looks straightforward on the form itself, but the underlying accuracy is everything. HMRC reads the gross asset figures, the employee count, the share allotment details, and the use-of-funds confirmation against the company's filed accounts and against the prior advance assurance application. Internal inconsistencies trigger follow-up queries that can extend the approval window from 30 working days to three months.

Specialist accountants in our network draft the SEIS1 from the underlying source data (filed accounts, payroll records, share register, bank statements showing receipt of subscription monies), reconcile every figure against the accounts, and submit the form with the supporting documentation HMRC expects. The result is a clean approval inside the published service-level window and SEIS3 certificates in investor hands within four to eight weeks.

The SEIS1 (form name: SEIS1 Compliance Statement) is the formal HMRC declaration that the company satisfied the SEIS qualifying conditions at the date of share issue and has continued to satisfy them through the four-month qualifying period that follows. EIS has an exactly parallel form (EIS1). The form is filed online via HMRC's Venture Capital Schemes portal and produces, on approval, a batch of pre-numbered SEIS3 (or EIS3) certificates that the company physically forwards to the investors.

The earliest filing date is four months after the later of (a) the share issue date, or (b) the date the company commenced its qualifying trade. For a company that was already trading at the time of share issue, the four months runs from the share issue. For a pre-trade company that began trading after the share issue, the four months runs from commencement of trade. The latest filing date is two years after the end of the tax year in which the shares were issued, or two years after the four-month qualifying period (whichever is later), but in practice no founder ever waits anywhere near that long because the investors cannot claim relief until the SEIS3 is in hand.

The form requires: the company UTR, the company's accounting period dates, the date the qualifying trade began, the date the shares were issued, the number of shares issued, the share class, the amount subscribed in total, the gross assets immediately before and immediately after the share issue, the number of full-time-equivalent employees, a confirmation that the use of funds is for the qualifying business activity within the two-year window, and a list of investors with name, address, number of shares subscribed for, and amount each invested. Each of these figures has to be defensible against the company's accounting records.

HMRC's published service-level target for processing a SEIS1 is 30 working days (six weeks). In practice the range is two weeks to three months, with the variation driven by HMRC backlog and by whether the application contains internal inconsistencies that trigger follow-up queries. The single biggest source of follow-up queries is gross asset figures that do not reconcile to the company's filed accounts. The second biggest is employee numbers that do not match the payroll records. A SEIS1 that has been drafted from the source documentation, with the figures cross-checked against the accounts and the payroll, reliably comes back inside the published window.

On approval, HMRC issues the company an authorisation letter and a stack of pre-numbered SEIS3 certificates, one per investor. The company is then responsible for sending each investor their certificate. The investor uses the SEIS3 to claim relief on their self-assessment tax return for the year of the share issue (or the previous year, by carry-back election). The carry-back election is particularly valuable for investors who want to claim relief against the previous year's higher earnings, and the SEIS3 must be physically in the investor's hands at the point the claim is made. Founders who are slow with SEIS3 distribution (taking months instead of days) routinely lose investor goodwill and risk losing the next round of capital.

Companies whose first set of statutory accounts is not yet filed at Companies House at the time the SEIS1 is due face an evidence challenge. HMRC accepts management accounts in this situation provided they are clearly labelled as such and the underlying figures are defensible. The accountant prepares a management accounts pack covering the relevant period, with explicit reconciliation to the bank statements and the share register. HMRC will approve on this basis but will sometimes ask for the statutory accounts to be supplied later as a follow-up evidence requirement.

Companies that issued shares in two tranches within the same round (combined SEIS and EIS, sequenced over different days) need two separate compliance statements. The SEIS1 covers the SEIS-share allotment with the SEIS investor list; the EIS1 covers the EIS-share allotment with the EIS investor list. Both forms reference the same underlying company information but have separate share-issue dates and separate investor lists. A common error is filing a single combined form, which HMRC will reject and require resubmission.

Investors who hold their SEIS or EIS shares through a nominee (a custodian, an investment platform, or a SIPP) raise specific HMRC questions about beneficial ownership. The SEIS1 names the legal owner of the shares, but the relief is claimed by the beneficial owner. Where the legal owner is a nominee, HMRC requires a clear identification of the underlying beneficial owners on the form. The accountant works with the nominee provider (typically Seedrs, Crowdcube, or a SIPP provider) to assemble the underlying-beneficial-owner data in the format HMRC expects.

Companies that receive an HMRC enquiry on a SEIS1 (typically a request for further information rather than an outright denial) need to respond within the 21-day deadline HMRC sets, otherwise the application is treated as withdrawn. The most common enquiries are: a discrepancy between the gross asset figure on the SEIS1 and the figure in the filed accounts; an employee count that includes part-time staff treated as full-time-equivalent; an investor name or address that does not match HMRC's records on the investor's personal tax file. The accountant responds with the supporting evidence and a covering letter that walks HMRC through the reconciliation. Most enquiries resolve in a single round of correspondence; a small minority extend into multiple rounds and lengthen the approval timeline materially.