What’s Changing for 2026
From 6 April 2026, the UK government rolled out significant enhancements to Entrepreneurial tax relief schemes that support high-growth firms. Key changes include: a higher gross assets cap for the Enterprise Management Incentives (EMI) scheme; increased per-company investment limits under Enterprise Investment Scheme (EIS) and Venture Capital Trusts (VCTs); and reduced upfront relief rates for VCTs to make reliefs more balanced. (gov.uk)
What the New Reliefs Mean
- EMI’s asset ceiling quadruples from £30 million to £120 million, which means larger tech or biotech firms can use share options to reward staff. (gov.uk)
- The company and share option limit under EMI doubles (from 250 to 500 employees, £3 million to £6 million)—this opens reliefs for more scale-ups. (gov.uk)
- EIS and VCT changes: lifetime company investment limits go to £24 million, and annual company limits to £10 million, with gross assets tests adjusted. VCT relief drops from 30% to 20% for investors. (gov.uk)
Examples & Applications
| Situation | Under Old Rules | After New Rules |
|---|---|---|
| Tech scale-up with £40m assets seeking to issue share options through EMI | Ineligible—asset cap at £30m | Eligible—asset cap now £120m |
| Early-stage business raising £5m | Within older EIS annual and lifetime caps | Now higher £10m/£24m caps allow more investment |
| Investor in VCT expecting 30% relief | Generous upfront tax relief | Lower relief (20%), but aligning with risk-reward balance |
Actionable Insights for Founders & Investors
- Founders should evaluate whether they need to reissue or expand share-option schemes under EMI now that larger firms can qualify.
- Employees should check whether their options or shares fell outside the old limits and could be brought under the new reliefs.
- Investors eyeing VCTs should consider the adjusted 20% relief and whether EIS or VCT investment now makes more sense based on company size and stage.
- Financial advisers and tax teams must track reporting obligations—the enhanced limits will affect valuation, eligibility and documentation.
Key Takeaways
- The government is doubling down on supporting scale-ups and high-growth firms—not just start-ups.
- While relief rates change (especially for VCTs), opportunity is expanding for more businesses and more employees to benefit.
- Timing is important—schemes are now in effect, so planning should be up to date with the new thresholds.
By aligning your business strategy or personal portfolio with these new reliefs, you can save tax, attract talent, and unlock funding more effectively in 2026 and beyond.