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Government unveils £100m investment boost to support start-ups

Entrepreneurs, start-ups and scale-ups across the UK are set to benefit from a new Government-backed investment package.

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Entrepreneurs, start-ups and scale-ups across the UK are set to benefit from a new Government-backed investment package designed to unlock private funding and expand tax reliefs.

Announced by HM Treasury and Chancellor Rachel Reeves, the measures came into force at the start of the new tax year on 6th April 2026.

The reforms are expected to unlock around £100m of additional investment annually.

The package includes significant changes to key schemes aimed at supporting high-growth businesses.

The Enterprise Management Incentives (EMI) scheme has been expanded to allow more companies to offer tax-advantaged share options to employees, helping firms attract and retain talent.

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Eligibility thresholds have been raised, with the gross assets limit increasing from £30m to £120m, and employee and share option limits also doubled.

Investment incentives have also been strengthened through updates to the Enterprise Investment Scheme (EIS) and Venture Capital Trusts (VCTs).

Lifetime investment limits for companies under these schemes have doubled to £24m, while annual limits have increased to £10m, widening access to funding for early-stage and scaling businesses.

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However, income tax relief for VCT investors has been reduced from 30% to 20%, a move intended to balance incentives and encourage stronger returns.

Alongside tax reforms, the Government has introduced additional measures to support business growth.

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These include a three-year UK Listings Relief, offering an exemption from Stamp Duty Reserve Tax for companies listing domestically, and the British Business Bank’s new five-year strategic plan.

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The bank plans to invest at least £5bn into growth-stage companies and funds as part of a broader £25.6bn financial capacity.

Commenting on the reforms, Chancellor Rachel Reeves said: “I am backing business with a more active state that’s making big commitments to industry.

“I have taken steps to unlock £100 million a year for new investment in the businesses founded by our wealth creators so they can access the finance critical to their success.”

Industry stakeholders broadly welcomed the changes, particularly the expansion of EMI, which is expected to support around 1,800 high-growth companies and benefit an estimated 70,000 employees over the next five years.

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Carolyn Dawson, CEO at Founders Forum Group, said: “The UK has always been a brilliant place to start a company and today’s reforms are a positive step towards making it just as compelling a place to scale.

“We’re particularly pleased to see the expansion of the EMI scheme: giving more employees a genuine stake in the companies they’re building is one of the most powerful ways to attract talent and reward the risk-takers who drive British innovation forward.

“But keeping Britain’s best companies at home requires an ongoing commitment from all of us to back British success stories.

“When British innovation thrives, it translates directly into better jobs, higher wages, and a more resilient economy for everyone.”

Eva Barboni, executive director of Enterprise Britain, said: “Britain needs more companies to make the leap from start-up to scale-up to global champion.

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“These measures speak directly to two of the three pillars we set out as urgent priorities in our most recent report: access to capital and the ability to attract and retain talent.

“The changes to the EMI scheme are particularly important. Talent is the lifeblood of high-growth firms, and widening access to share ownership will help more British scale-ups attract and retain the people they need to compete globally.

“It will also help ensure that the benefits of those companies’ success are shared more widely.”

Dom Hallas, executive director at Startup Coalition, added: “Expanding EMI is a genuine win for the startup ecosystem – it gives high-growth companies far more room to compete for talent, which is ultimately what drives scaling success.

“The improvements to EIS will also help unlock more capital into early-stage businesses, particularly in knowledge-intensive sectors where the UK has real comparative advantage.

“We are optimistic that next year we will see further improvements to the tax landscape for founders, following the ongoing call for evidence.”

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