The rules associated with EISs are:
The investment must be into new shares
The investee company must have fewer than 250 employees
The investee company must use the money raised within 24 months
Companies must be unquoted or listed on the Alternative Investment Market (AIM)
The company must not be controlled by another company
Any investment of EIS funds must not exceed more than £10 million per 12 month period
Certain trades are excluded, for example, mining and financial services companies.
For any new investments, there is an investment cap of £12 million (£20 million for knowledge intensive businesses who may also have up to 499 employees).
For any new investment, managers are no longer able to finance Management Buy-Outs or Acquisitions.
For all new investments a qualifying company must be no more than 12 years old, unless fundraise will fundamentally change business activity. The company must also have made their first commercial sale within the last 7 years.
For all new investments (as of April 2018), knowledge intensive companies must have made the first commercial sale or reached turnover of 200,000 in the last 10 years.