Employment Allowance and SEIS: check the award date

Reviewed and updated: 21 September 2026.

Employment Allowance requires a date-sensitive check when calculating SEIS headroom. The older rule should not be applied to every current award, and the April 2025 change should not cause earlier relevant aid to be overlooked.

The original article highlighted the treatment introduced from April 2020. The position subsequently changed, making the date and nature of the award important.

What changed in April 2025?

HMRC explains that the £100,000 employer National Insurance threshold for Employment Allowance was removed from 6 April 2025. Its April 2025 Employer Bulletin says employers no longer need to consider state aid where they previously did so because of that threshold restriction. HMRC Employer Bulletin.

Current guidance still addresses claims for previous tax years: where the claim identifies a relevant business sector, HMRC can issue a letter stating that the Employment Allowance counts as de minimis state aid. Keep that letter. HMRC guidance after claiming.

Why can earlier awards still matter for SEIS?

SEIS has a £250,000 funding limit that includes specified earlier SEIS investment and other relevant aid within the statutory period. ITA 2007 s.257DL looks at the current investment day and the three years immediately before it.

The calculation therefore requires an award history, not just the company's current payroll position. A relevant earlier Employment Allowance award may still fall within that period. Conversely, it would be wrong to deduct every recent Employment Allowance amount automatically without considering the post-April-2025 change and the applicable rules.

What should a company collect?

Before applying for assurance or issuing SEIS shares, reconcile:

• previous SEIS share issues and the amounts subscribed;
• Employment Allowance claims, the tax years involved and relevant award correspondence;
• other grants or assistance and their state-aid classification;
• the date of the proposed SEIS issue;
• amounts already disclosed to HMRC in previous applications.

Ask the body providing an award to confirm its classification where that is unclear. Do not assume that every grant reduces SEIS headroom or that every employment-related relief is treated identically.

Applying the answer to the funding round

Show the headroom calculation and relevant aid history consistently in the advance assurance application and subsequent SEIS1 submission. An assurance letter does not compensate for an incomplete disclosure of earlier funding.

This article updates the earlier discussion of the April 2020 position. It should be read alongside current SEIS company guidance; the £150,000 funding figure in older material was increased to £250,000 from April 2023.

For help with a proposed investment, discuss your SEIS or EIS position with IP Tax Solutions. We can agree the scope of a review around the facts and the point causing concern.

This article provides general information. Company, share and investor conditions require separate consideration.