Findawealthmanager.com, which matches clients and advisors in the wealth management industry, says 54 per cent of the UK's leading wealth managers are now offering Enterprise Investment Scheme funds and 38 per cent provide Seed Enterprise Investment Schemes. 

“I think it’s fair to say that many wealth managers have historically avoided EIS because it was seen as high risk,” said co-founder of findawealthmanager.com Lee Goggin. “The last year has seen a growing acceptance of EIS among wealth managers as the tax benefits are making them look more attractive.”

The shift follows the UK government's clampdown on tax avoidance measures in recent years, meaning the wealthy have been seeking alternative tax-efficient ways to invest their money. 

The individual EIS allowance currently stands at £1 million ($1.54 million) and carries an available loss relief. Although this may imply a high-risk investment, if losses occur, capital loss relief can be up to 45 per cent of the net investment after an income tax relief of 30 per cent. This brings total potential tax relief to 61.5 per cent of the original investment. As for SEIS, where income tax relief is 50 per cent, loss relief can be as much as 86.5 per cent.

“These schemes are government approved, the perks are incredibly generous given the current environment and we are seeing growing sophistication in the EIS market," said Goggin. “The EIS regime in particular offers a lot of flexibility as well so the EIS managers themselves can often invest in quite mature, successful businesses.”

Since EIS funding launched in 1993-94, an approximate £10.7 billion of investment has been directed to over 21,000 companies, according to the online matching service.