If you've been angel investing in the UK for a while, you'll know the rhythm: every spring a Budget reshapes the tax rules a little, and you find out in March which assumptions from last year no longer hold. The 2026 changes were bigger than most. Five of them landed on a single day, 6 April 2026, and between them they touch the relief you claim, the companies you can put scheme money into, what your estate keeps, and what you pay when you sell.
This is the round-up. Each change gets a few plain sentences and a link to the longer piece if you want the detail. The reassuring part first: the two reliefs most angels lean on hardest, EIS at 30% and SEIS at 50%, were left alone. The rest did move, so here's what to know.
Five changes, one date. The core EIS and SEIS rates survived; almost everything around them shifted.
The headline: a lot moved on 6 April 2026
Start with what stayed put, because it matters. EIS income tax relief is still 30% on up to £1,000,000 a year, SEIS is still 50% on up to £200,000, and the three-year holding periods, loss relief and capital gains treatment for both are unchanged. If your activity is mostly direct SEIS and EIS cheques, your day-to-day maths looks much as it did in 2025.
Around that core, five things changed at once. VCT relief was cut. The company-eligibility limits for EIS and VCT were raised. A cap arrived on the inheritance tax relief that EIS shares often attract. The rate on Business Asset Disposal Relief went up. And carried interest moved from capital gains to income tax. The first two affect almost every active angel; the last three affect you depending on whether you sit on a large estate, plan to sell a business, or lead a syndicate. The sections below take each in turn.
VCT relief cut to 20%
The most-discussed change is the Venture Capital Trust. From 6 April 2026, income tax relief on new VCT subscriptions is 20%, down from 30%. Shares subscribed for before that date keep the old 30% rate, so this is forward-looking, not retrospective. The other VCT features are untouched: the £200,000 annual limit for relief, tax-free dividends, no capital gains tax on the shares, and the five-year holding period (longer than EIS's three).
In dividends terms, the full £200,000 into VCTs now reclaims £40,000 of income tax rather than £60,000. That narrows VCT's old headline-relief parity with EIS without settling what each is for - a VCT is still a one-decision, diversified, income-style holding, where EIS is a concentrated, higher-relief bet you pick yourself. We work through the comparison in is a VCT still worth it now relief is 20%.
EIS and VCT company limits went up
Less noticed, but arguably more useful, is that the company-side limits were raised. A company can now hold up to £30m of gross assets before a qualifying share issue (and £35m after), up from £15m and £16m. The amount a company can raise under the schemes also went up - £10m a year and £24m over its lifetime, with higher figures for knowledge-intensive companies. You can read HMRC's rules in the guidance for investors.
For you, the effect is on the pipeline rather than your own caps. Larger and later-stage companies now fit inside the EIS and VCT rules than did before, so more of the deals you see can carry relief. Your investor limits - the £1,000,000 a year for EIS, £200,000 for SEIS - did not change. The detail, and what it means for the kind of round you'll be shown, is in EIS and VCT company limits went up in 2026.
Inheritance tax, the exit, and the fund lead
Three changes hit narrower groups. The first is inheritance tax. From 6 April 2026, 100% Business Property Relief (BPR) - the relief that lets qualifying unquoted trading shares pass largely free of IHT after a two-year hold at death - is capped at £2.5m per person, with 50% relief above the cap. Note the figure: the £1m first announced in October 2024 was revised up to £2.5m on 23 December 2025, so older coverage you find may be out of date. Most EIS shares sit in this capped 100% band; AIM-listed shares get 50% only. The detail is in Business Property Relief on EIS shares, and HMRC's overview is at GOV.UK.
The second is the exit. Business Asset Disposal Relief (BADR), the reduced capital gains rate on a qualifying sale of your own trading company, rose to 18% from 6 April 2026 (it was 14% in 2025/26, and 10% before that). The £1m lifetime limit stays. This is the relief a founder-turned-angel meets on the way out, not a venture-scheme relief - more in BADR is now 18%.
The third is for syndicate leads. Carried interest - a lead's share of a fund's profits, and the reason this newsletter is called The Carry - is now taxed as income rather than capital gains, at an effective rate of around 34.075% on qualifying carry. This is fund territory, not a solo angel's own gains, and we cover it in carried interest is now taxed as income.
What it means, and a note on what this isn't
The net read for a typical active angel: your core toolkit held up. EIS and SEIS relief rates, holding periods and loss relief are where they were, and the higher company limits quietly widen what you can put that money into. The cut that bites is on VCTs, and only on new subscriptions. The IHT cap, the higher BADR rate and the carried-interest change matter intensely to some readers and not at all to others, depending on your estate, your exit plans and whether you lead a syndicate.
One thing this round-up is not: a steer towards or away from any scheme, structure or deal. Every relief here is conditional, capped by your own tax position, and tied to companies that are among the most likely investments to lose the lot. The rules also move - the 2026 Budget is itself the proof, and the BPR figure changing between October 2024 and December 2025 shows how fast “settled” numbers can shift. Confirm the current position in the relevant GOV.UK guidance and take FCA-regulated advice before you act on any of it.
Frequently asked questions
What are the main 2026 tax changes for angel investors?
Five changes landed on 6 April 2026. VCT income tax relief fell from 30% to 20% on new subscriptions. The EIS and VCT company-eligibility limits went up, so a company can hold up to £30m of gross assets before a share issue. 100% Business Property Relief for inheritance tax was capped at £2.5m per person. Business Asset Disposal Relief rose to 18%. And carried interest is now taxed as income rather than capital gains.
Did EIS or SEIS income tax relief change in 2026?
No. EIS income tax relief is still 30% and SEIS is still 50%, and the holding periods, loss relief and capital gains treatment for both are unchanged. What changed on the EIS side were the company-eligibility limits, which were raised. The relief that fell was the VCT rate, from 30% to 20%.
Is VCT relief still 30%?
Not for new subscriptions. From 6 April 2026, income tax relief on new VCT subscriptions is 20%. Shares subscribed for before that date kept the 30% rate. The other VCT features - the £200,000 annual limit for relief, tax-free dividends, no capital gains tax on the shares and the five-year holding period - did not change.
When did the 2026 changes take effect?
All five took effect on 6 April 2026, the start of the 2026/27 tax year. The VCT cut applies to new subscriptions from that date, while shares subscribed for earlier keep their old terms. One figure to watch is the inheritance tax cap on Business Property Relief: it was first announced as £1m in October 2024 and then revised up to £2.5m per person on 23 December 2025.
Is this article financial advice?
No. This is general information about how the rules changed, not financial advice and not a recommendation to use any scheme, structure or deal. The figures depend on your own circumstances and change with each Budget. Confirm the current position at GOV.UK and take FCA-regulated advice before making any investment decision.