EIS stands for Enterprise Investment Scheme, which is a UK government scheme designed to encourage investment in small and medium-sized enterprises (SMEs). The scheme offers a range of tax incentives to individuals who invest in eligible companies, with the aim of helping these companies raise finance and grow.

Under the EIS, investors can receive income tax relief of up to 30% on the amount they invest, subject to certain conditions. They can also receive capital gains tax relief on the sale of EIS shares, as long as they hold the shares for at least three years. In addition, any gains made on the investment are free from capital gains tax.

To be eligible for the EIS, companies must meet certain criteria, such as being a UK-based SME with fewer than 250 employees and gross assets of no more than £15 million. The company must also be engaged in a qualifying trade, such as manufacturing or technology, and cannot be involved in certain industries, such as property development or finance.

There are also limits on the amount of money that can be raised through the EIS, with a maximum of £5 million per year and a lifetime limit of £12 million.

The EIS can be a complex scheme, and investors and companies should seek professional advice to ensure that they are eligible and complying with all relevant rules and regulations. However, for eligible companies and investors, the EIS can be a valuable source of funding and a way to access tax incentives that can help support business growth.