Britain’s entrepreneurship tax package is now live. From 6 April 2026, the government has widened Enterprise Management Incentives, doubled company-level limits under the Enterprise Investment Scheme and Venture Capital Trusts, and introduced a temporary UK Listing Relief. In its announcement on gov.uk, HM Treasury said the reforms are expected to support around £100m of additional investment each year.

The EMI expansion moves the scheme firmly into scale-up territory. The gross assets threshold rises from £30m to £120m, the employee cap doubles from 250 to 500, and the company share option limit increases from £3m to £6m. For founders and finance leads, that creates room to extend equity participation deeper into the organisation without shifting to less tax‑efficient alternatives.

On hiring, this should matter quickly. Equity remains one of the few levers smaller firms can use to compete with cash‑rich incumbents. The Treasury expects around 1,800 high‑growth companies across fintech, life sciences and AI to benefit over five years, with an estimated 70,000 employees gaining access to options. For candidates, the signal is straightforward: more roles will carry genuine ownership potential rather than symbolic grants.

The EIS and VCT company limits double to a £24m lifetime cap, with annual investment up to £10m. The gross assets test rises to £30m before a share issue and £35m after. In practice, this supports larger follow‑on cheques and reduces round fragmentation at the point where many UK firms hit a funding wall between Series A and B. It also gives boards a clearer runway to scale domestically rather than defaulting to overseas capital too early.

There is a trade‑off for retail investors: upfront Income Tax relief on VCT subscriptions falls from 30% to 20%. That will push a greater share of total return to dividends and NAV growth rather than tax relief. As a simple sense‑check, a £10,000 VCT subscription now delivers £2,000 of relief versus £3,000 previously; the manager’s ability to back genuine outliers will matter more to net outcomes.

Beyond tax reliefs, the British Business Bank’s new five‑year plan scales permanent capacity to £25.6bn, with at least £5bn earmarked for growth‑stage funds and scale‑ups. The BBB has also been asked to explore how existing guarantee capacity could support IP‑backed lending-useful for R&D‑heavy firms whose balance sheets are light on tangible assets but rich in know‑how.

On listings, the government has introduced a three‑year exemption from Stamp Duty Reserve Tax for companies that choose to list in the UK. It won’t, on its own, solve liquidity or research coverage, but it trims a friction cost and should help post‑IPO trading volumes and valuations at the margin-especially for scale‑ups considering a domestic float.

Put together, these moves shift the funding mix a notch in favour of UK growth companies. Larger EIS/VCT capacity should ease the step from early traction to scale, while broader EMI eligibility makes it simpler to align teams with long‑term value creation. The likely effect is a modest reduction in the weighted average cost of capital for the best performers, and a stronger link between hiring plans and equity rewards.

Founders should now revisit their cap tables and hiring plans. If headcount will pass 250 or 300 this year, model grant sizes under the higher EMI limit, update valuations, and refresh communications so employees understand how option gains are taxed and what could cause disqualification. For those contemplating a raise, the higher EIS/VCT caps argue for cleaner rounds and longer runways rather than piecemeal bridging.

For employees, the expansion means share options are more likely to be meaningful and better aligned with company milestones. Focus on vesting schedules, leaver provisions and exercise windows; the tax advantages of EMI remain attractive, but cash planning still matters around exercises and exits. For investors, a lower VCT relief places a premium on manager selection, sector access and discipline on costs.

The direction of travel is clear: keep more British winners starting, scaling and-crucially-staying in the UK. The consultation launched alongside Budget 2025 has closed, with a government response due in due course. For now, the immediate task for finance teams is to operationalise the changes and convert policy into offers, term sheets and growth hiring over the next two quarters.