What is the advantage of SEIS concerning capital gains?

The advantage of the Seed Enterprise Investment Scheme (SEIS) concerning capital gains is that it allows reinvestment in SEIS qualifying shares to exempt up to 50% of gains from Capital Gains Tax (CGT). This means that investors can effectively reduce their overall CGT liability when they make qualifying investments under the SEIS framework. By reinvesting capital gains into SEIS-eligible companies, individuals can benefit from this tax relief, which supports small businesses and encourages investment in early-stage companies.

The specific benefit of up to 50% exemption is significant because it incentivizes investors to redirect their profits into new ventures instead of potentially facing a substantial tax burden on their gains. This makes the SEIS an attractive option for investors looking to increase their investment portfolios while also getting favorable tax treatment.

Other options do not accurately reflect the features of SEIS. For example, the scheme does not eliminate all capital gains taxes nor provide tax relief on all investments, as the relief is specifically associated with SEIS-qualifying investments. Additionally, SEIS is not limited to property investments; it is geared primarily towards supporting small and young businesses across various sectors.