The UK’s entrepreneurship tax package took effect on 6 April 2026, expanding Enterprise Management Incentives (EMI) and doubling Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) company limits. HM Treasury estimates the package will support around £100 million of additional investment each year. Measures announced at Budget 2025 are now in force following Royal Assent to the Finance Act 2026 on 18 March 2026. (gov.uk)
For EMI, the qualifying company size thresholds have been reset to reflect later‑stage growth. From 6 April 2026, the employee count cap rises from 250 to 500, the gross assets limit increases from £30 million to £120 million, and the overall company share option limit doubles from £3 million to £6 million. The permitted exercise period extends from 10 to 15 years, and that extension can be applied to existing EMI options that have not yet expired or been exercised. These changes are legislated via amendments to Schedule 5 of ITEPA 2003. (gov.uk)
EIS and VCT company financing thresholds have been increased to accommodate larger follow‑on rounds. From 6 April 2026, the annual amount a company can raise rises to £10 million, with a £20 million annual ceiling for knowledge‑intensive companies; the lifetime cap increases to £24 million, or £40 million for knowledge‑intensive companies. The gross assets test moves to £30 million immediately before, and £35 million immediately after, the relevant share issue, via amendments to specified sections of ITA 2007. (gov.uk)
There is also a re‑balancing of investor incentives. The upfront Income Tax relief for individuals investing in VCTs reduces from 30% to 20% for investments made on or after 6 April 2026. HMRC frames the change as aligning the mix of reliefs with EIS, which does not offer dividend exemption, while aiming to focus VCT deployment on higher‑growth opportunities. (gov.uk)
Scope limitations apply in Northern Ireland. For both the EMI expansion and the increased EIS/VCT limits, specified companies registered in Northern Ireland and trading in goods or electricity remain subject to the previous thresholds to comply with the UK’s international subsidy control arrangements. Practitioners should confirm NI status and activity before relying on the new limits. (gov.uk)
Alongside the tax changes, the government’s UK Listing Relief is now live. For companies newly listing on a UK regulated market, transfers of their securities benefit from a three‑year exemption from the 0.5% Stamp Duty Reserve Tax (SDRT) on agreements to transfer, effective for agreements made on or after 27 November 2025. The relief covers depositary interests, but does not extend to the 1.5% SDRT on transfers into depositary receipt systems or to transactions forming part of a takeover that changes control. (gov.uk)
Public finance institutions are being directed to reinforce scale‑up capital. The British Business Bank’s Five‑Year Strategic Plan confirms a permanent total financial capacity of £25.6 billion and a commitment to invest at least £5 billion through fund managers or directly into scale‑up companies over the plan period, complementing the expanded tax‑advantaged regimes. (british-business-bank.co.uk)
A parallel policy process is underway. HM Treasury’s call for evidence on tax support for entrepreneurs, launched at Budget 2025 and closed on 28 February 2026, seeks views on whether further adjustments to EMI, EIS and VCTs-or alternatives-could smooth funding ‘cliff edges’ as firms mature. The government has signalled it will publish a formal response in due course. (gov.uk)
For founders and finance directors, the immediate actions are practical. EMI headroom has increased significantly, enabling refreshed option pools and potential re‑grants for firms that had outgrown the old limits; the 15‑year exercise window may warrant amending existing awards and updating leaver provisions. On the fundraising side, the higher EIS/VCT thresholds support larger follow‑ons without breaching scheme caps, while the lower VCT income tax relief will influence investor pricing and communication around 2026/27 subscriptions. (gov.uk)
For companies preparing to list, UK Listing Relief reduces secondary‑market friction for the first three years post‑IPO, which HMRC argues should support liquidity and valuations. Finance teams should note the relief’s time‑bound nature and exclusions when modelling transaction costs and explaining post‑listing trading dynamics to prospective investors. (gov.uk)