Employee share options vs SEIS/EIS: what's the difference
They get mentioned in the same breath constantly, but they're not the same thing. One is equity you're given for working somewhere; the other is a tax relief for money you've personally invested. Here's how to tell which one you're actually holding.
"Employee share scheme" and "SEIS/EIS" get used almost interchangeably in casual conversation, and it’s easy to see why — both involve owning a small slice of a private company, both come with tax breaks worth understanding, and both show up on the same cap table. But they answer completely different questions: one is about how you were paid, the other is about where you put your own money.
Getting this right matters, because the tax treatment, qualifying conditions and paperwork are entirely different depending on which side of the line you’re on.
Employee share schemes: equity from your employer
EMI options, unapproved options and CSOP are all ways an employer grants you the right to acquire shares in the company you work for — usually as part of your compensation, on top of salary. You don’t hand over money up front; you’re granted an option, which typically vests over time and can be exercised (turned into actual shares) later, often tied to a sale of the company.
The three you’ll most commonly come across:
- EMI (Enterprise Management Incentive) — the most tax-efficient route, available only to qualifying smaller companies and capped per employee and in aggregate.
- Unapproved options — the fallback when EMI isn’t available (company too large, employee owns too much already, or the company simply hasn’t set EMI up) — no special tax treatment, so gains are typically taxed as income.
- CSOP (Company Share Option Plan) — HMRC-approved like EMI, but with different limits and no requirement that the company be a small one.
SEIS and EIS: relief for money you invest
SEIS (Seed Enterprise Investment Scheme) and EIS (Enterprise Investment Scheme) work the other way round. You’re not being granted anything for your work — you’re choosing to invest your own cash into a qualifying early-stage company, and in exchange the government gives you meaningful income tax relief up front, plus favourable capital gains treatment if the investment works out (and loss relief if it doesn’t).
You can absolutely be both: plenty of people hold EMI options from their employer and separately invest their own money into SEIS or EIS opportunities. They just don’t come from the same place, and Equdash tracks them as the distinct things they are rather than lumping them together.
The quick test
If you’re not sure which you’re holding, ask one question: did you pay for it? If the shares or options came as part of your job with no money changing hands from you, you’re looking at an employee scheme. If you wrote a cheque (or made a bank transfer) to buy shares in a company, and you received an SEIS3 or EIS3 certificate afterwards, you’re looking at an investment relief.
See exactly what you're holding
Upload your option agreements, certificates or SEIS/EIS3 forms and Equdash sorts out which is which — with the dates and figures that matter for each one tracked automatically.
Get started — it's free