SEIS/EIS Advance Assurance: Preparing Your Financials in Blox

Getting SEIS/EIS Advance Assurance (AA) from HMRC is a critical step in your fundraising journey, as it gives investors’ confidence in the tax relief they will receive. A key part of the application is submitting robust, but often deliberately conservative, financial projections.

Blox makes it easy to create a separate, compliant financial scenario for this purpose without messing up your primary operational plan.

1. Why Create a Dedicated HMRC Scenario?

For the AA application, HMRC is primarily interested in two things:

  1. That your company is genuinely new and innovative.
  2. That you need the money.

You must prove that the new funds are necessary for the growth and development of the company (the "risk to capital" condition). If your current, optimistic financial model shows you have plenty of cash and are profitable very soon, HMRC may challenge the application.

Therefore, for your AA submission, your financial model should clearly demonstrate a funding gap that the SEIS/EIS investment is intended to fill.

💡 Tip: We strongly recommend working with a legal partner like SeedLegals (check out their Finance for Fundraising offering) to ensure all aspects of your application are compliant.


2. Creating Your HMRC Scenario in Blox

You should never alter your primary working financial model for the HMRC submission. Use Blox's Scenario feature to create a dedicated version:

  1. Navigate to Scenarios: On your Blox Dashboard, find and click the "Scenarios" tab or section.
  2. Duplicate Your Primary Model: Select your main financial model (e.g., "Base Case" or "Operating Plan") and choose the option to Duplicate it.
  3. Rename the New Scenario: Name the new scenario clearly, such as "HMRC Advance Assurance Submission".
  4. Activate the New Scenario: Switch to this new scenario. All the changes you make from this point forward will only apply to the AA submission model.

3. Adjusting the Financials to Prove the Need for Funding

Your goal here is to make conservative adjustments to clearly show that without the investment, the company will run out of cash. This will usually involve tweaking your Revenue and Cost Blocks.

A. Reducing Revenue Projections

HMRC prefers models based on sound assumptions, not aggressive optimism. A safe bet is to significantly pull back on your top-line growth.

  • Action in Blox: Go to your core Revenue Blocks (e.g., Sales, Subscriptions).
  • What to Change: Decrease the monthly or annual growth rates for your core revenue streams. You can even delay the start date of major revenue drivers by a few months.
  • Result: This pushes the break-even and profitability points further into the future, increasing your total cash burn.

B. Increasing Operating Costs

To further demonstrate a cash need, you can accelerate or increase planned spending, particularly in areas like staffing and operations.

  • Action in Blox: Focus on your Cost Blocks, especially Personnel/Hiring.
  • What to Change:
  • Increase Workforce/Hiring: Accelerate the hiring plan by bringing key hires forward by 1-3 months. Increasing salaries slightly is another conservative move.
  • Increase Other Costs: Adjust blocks for Marketing Spend, R&D, or Office Costs to reflect higher-than-expected expenses.

C. Reviewing the Dashboard

After making these adjustments, go back to the Blox Dashboard and look at two key reports:

  • Profit & Loss (P&L): Ensure your business shows a clear operating loss for the initial 12-24 months.
  • Cashflow: This is the most crucial report. You must see the Cash Balance trending down over the forecast period, demonstrating a clear point where you run out of money (the funding gap).

4. Determining Your Exact Funding Requirement (The Financing Block)

Blox helps you calculate your exact funding requirement using the Financing Block and the concept of the lowest cash point.

Step 1: Zero Out the Funding

In your "HMRC Advance Assurance Submission" scenario:

  1. Navigate to your Financing Block (which forecasts future investment).
  2. Temporarily set the expected investment amount to (or remove the block entirely).

Step 2: Identify the Lowest Cash Point

  1. Go to the Cashflow chart on your Dashboard.
  2. Look at the monthly cash balance line. The lowest point (the most negative cash figure) reached during your forecast period represents the absolute maximum amount of cash you need to raise to survive until the point of positive cash flow.
  • Example: If your cash balance hits its lowest point at -£250,000 before trending up, your absolute minimum funding requirement is £250,000.

Step 3: Set the Investment Amount

  1. Return to your Financing Block.
  2. Set the fundraising amount to match the lowest cash point identified in Step 2, plus a reasonable buffer (e.g., adding £50,000 for working capital or unexpected delays).
  3. Final Check: View the Cashflow chart again. Your cash balance should now remain positive throughout the entire forecast, with the lowest point being your chosen buffer amount.

This methodology provides HMRC with a clear, verifiable number for your funding ask, backed directly by the conservative assumptions in your financial model.


You're one step closer to submitting your AA! If you need help structuring your overall business plan or navigating the HMRC portal, consider engaging a legal expert like SeedLegals.

Further Resources