Tax relief for angel investors: rereading the UK's 2026 SEIS/EIS data

Every May, HMRC publishes the scoreboard for the UK's two flagship startup investment reliefs: the Seed Enterprise Investment Scheme (SEIS) and the Enterprise Investment Scheme (EIS). What makes this dataset useful is that it counts money actually filed and claimed, not rounds announced. For anyone doing angel investing, it is the cleanest available measure of how much private capital really reaches the earliest stage.

The money is flat, the people are leaving

EIS companies raised £1,575m in the 2024-25 tax year, virtually identical to the year before. That level sits below where EIS stood before the pandemic (£1,894m in 2019-20) and well short of the £2,300m peak of 2021-22. More telling than the headline: the number of investors claiming EIS income tax relief fell from 35,675 to 33,220, and the amount on which relief was claimed dropped about 7%. HMRC attributes the softness to a sustained stretch of higher interest rates and a natural cooling after that record year. Same pool of capital, fewer people deploying it, each one more concentrated.

SEIS grew because the cap was lifted where it actually pinched

At the earliest stage the story reverses. SEIS hit its highest level since inception: £276m into 2,430 companies across a record 57,780 subscriptions. Against £242m and 2,310 companies a year earlier, that is a 14% increase. Both EISA and HMRC point to the April 2023 expansion, which raised the amount a single company can take under SEIS from £150,000 to £250,000. The technical lesson is precise: when a cap is lifted exactly at the pre-seed notch where the old ceiling cut rounds in half, capital responds within two tax years.

But widening a relief always adds administrative friction. On advance assurance, 4,085 SEIS applications were received in 2025-26, of which 3,090 (76%) have been approved so far, against 3,285 applications and an 85% approval rate the year before. For EIS, 3,310 applications produced 2,365 approvals (72%). Applications up roughly a quarter, hit rate down almost ten percentage points. Meanwhile, major changes to EIS took effect on 6 April 2026, almost doubling the amount a company can raise under the scheme.

Angel groups are infrastructure, not clubs

The most interesting data in UKBAA's UK Angel Investment Market 2025 report concerns angel groups. Across 27 surveyed groups, £53m was invested directly, but that money sat inside rounds worth £348m in total. The groups therefore supplied roughly 15% of the capital in the rounds they joined while anchoring and crowding in the other 85%. Compilations of the same UKBAA data put those £53m across 321 deals in 2025 — about one deal per group per month, an average group cheque near £165,000 per deal and just under £2m per group per year. Beyond capital, UKBAA counts more than 8,000 founders supported and more than 8,100 jobs created.

• Regional concentration: London and the South East accounted for £948m, or 60% of all EIS investment in 2024-25.
• Sector concentration: information and communication companies took £550m, about 35% of EIS investment.
• New entrants: some £333m was raised by 1,145 companies using EIS for the first time in 2024-25.
• Share conditions: shares must be new, ordinary, non-redeemable, carry no special rights and be paid for in full in cash.
• SEIS relief: 50% income tax relief on up to £200,000 invested per tax year, plus capital gains tax exemption after three years.

Stack the three layers together and the UK model is not "cut taxes and capital appears". It is three interlocking parts: a relief generous enough to price early-stage risk; a pre-clearance mechanism so founders know they qualify before opening a round; and a layer of angel groups with steady deal cadence to convert relief into actual rounds. Without the third part, tax relief produces retail buyers; with it, every angel pound pulls in roughly five and a half more.