SEIS and the Financial Promotion Rules: Where the Lines Sit
What counts as a promotion, which exemptions matter, and where advisers and founders trip.
In this article
Talking about an SEIS round is regulated activity territory, and most of the people doing the talking have never read the rules. Section 21 of the Financial Services and Markets Act makes it a criminal offence to communicate an invitation or inducement to invest unless you are authorised or an exemption applies. That catches pitch decks, investor emails, demo days and LinkedIn posts. This guide maps the SEIS financial promotion lines for founders, and for the advisers who get asked to bless the deck.
What counts as a financial promotion
The test is an invitation or inducement to engage in investment activity, communicated in the course of business. Shares in an SEIS company are controlled investments, so a founder emailing a deck with “we’re raising £200,000, come in” is squarely inside section 21. So is the demo-day pitch, the WhatsApp to a friend-of-a-friend with the subscription link, and the website page with a “invest in us” button. Intent is irrelevant; enthusiasm is not a defence; and “we’re a tiny startup” is not an exemption.
What generally is not an SEIS financial promotion: generic education about how SEIS works (this magazine’s entire posture), factual company information with no invitation attached, and communications that never reach the point of inducing investment activity. The line is substance over label. A document headed “for information only” that ends with a subscription form is a promotion with a hat on.
The three lawful routes for SEIS financial promotion
Route one: an authorised person approves the promotion. An FCA-authorised firm signs off the deck under section 21(2)(b). Since the 2024 tightening, firms need specific FCA permission to approve promotions for others, so the pool of approvers shrank and the price rose. This is the clean route for anything aimed wide.
Route two: the exemptions in the Financial Promotion Order. The workhorses for SEIS rounds are the exemptions for certified high net worth individuals and self-certified sophisticated investors. Since 31 January 2024, high net worth means income of at least £170,000 or net assets of at least £430,000 (the thresholds went up, and the sophisticated-investor company-director limb now requires the company to have £1.6 million turnover). The certification has to exist before the promotion is made to that person, the statements must follow the prescribed wording, and preliminary “are you certifiable?” filtering must itself stay on the right side of the line.
Route three: keep the communication outside the definition. One-to-one conversations that a recipient initiated, factual responses to unsolicited requests, and communications to investment professionals or existing angel networks operating under their own arrangements. Narrow, fact-dependent, and the route most often stretched past breaking.
Where founders actually trip
The public post: “Excited to open our SEIS round, DM for the deck” broadcast to an unfiltered audience is a promotion to everyone who reads it, certified or not. The event: pitching at an open evening where nobody checked attendee status. The forwarded deck: the founder promotes lawfully to one certified angel, who forwards it to five uncertified friends; forwarding is a new communication, and the deck should carry restrictions saying so. The website: an “invest” page indexed by Google is a promotion to the world. None of these is cured by the SEIS badge; HMRC assurance and FCA compliance are entirely separate systems, a point the common mistakes guide makes from the founder side.
The adviser’s own lines
Advisers meet this twice. First, their own communications: an authorised adviser communicating promotions inside their permissions is fine, but “SEIS opportunity of the month” emails to a retail client list still need to satisfy the fair-clear-not-misleading standard and the risk warnings that high-risk investment rules require, including the standardised warning and, for direct offer promotions, the appropriateness frictions. Tax relief must never be dressed as safety; the reliefs modify downside, they do not remove risk, which is why the suitability piece insists on asset-first analysis.
Second, the bless-my-deck request from founder clients. An accountant or unauthorised consultant who “just tidies up” a promotion and passes it on can become the communicator. The safe posture: advise on the tax facts, point the founder to the exemption architecture, and leave approval to a firm with the section 21 approver permission. Where the adviser is authorised, approval is a formal, documented act with ongoing monitoring duties, not a favour.
A practical protocol for an SEIS round
Before any deck moves: decide the SEIS financial promotion route (approval, exemptions, or excluded communications) and write it down. Build the certification step into the data room door, with the current prescribed statements, dated before access. Put restriction legends on the deck and make forwarding a breach. Keep the public layer generic: the company can say what it does and that it is growing; the invitation lives behind the certification gate. Keep a log of who received what, when, under which exemption. It is the same evidence discipline that protects the tax side of the round in the evidence trail, applied to the regulatory side.
Common questions
Can a founder legally pitch their SEIS round?
Yes. SEIS financial promotion has three defined routes: promotions approved by an appropriately permissioned FCA-authorised firm, promotions to investors certified as high net worth or sophisticated before the communication, or communications that fall outside the promotion definition. What is not lawful is broadcasting an invitation to invest to an unfiltered audience.
Does advance assurance mean the promotion rules are satisfied?
No. HMRC advance assurance is a tax opinion; section 21 is FCA territory. A round can be perfectly SEIS-qualifying and still be promoted unlawfully, and vice versa. The two systems never touch.
What are the high net worth thresholds now?
Since 31 January 2024: income of at least £170,000 in the last financial year, or net assets of at least £430,000 excluding the home and pension, with certification in the prescribed form before the promotion. Self-certified sophisticated investor criteria were tightened at the same time.
Sources
Financial Services and Markets Act 2000, section 21; the Financial Promotion Order 2005 as amended (2024 threshold changes); FCA PERG 8 and the high-risk investment rules in COBS 4. Position correct as at 17 July 2026. Education, not legal advice: promotion questions on a live round belong with a regulatory lawyer or compliance consultant.
