Boltholes and Hideaways
Employee Share Schemes: EMI Schemes & Company Share Option Plans.
Some businesses have a policy of allowing its employees to take out company shares.
The arrangement is a way of providing benefits for employees, which may include executive directors but not normally non-executive directors.
It can take the form of shares, interests in shares, share options or anything else where there is an advantage to be gained from having shares.
A company may wish to establish an employee share scheme for its employees for several reasons. These may include acting as an incentive for the employee to stay with the company, to reward employees for their workplace performance or to allow employees to obtain and sell their shares in a tax-efficient way over a period.
In short, shares can be used to attract potential employees and then as an incentive for motivation and retention.
For more information, and to discuss your needs in relation to an employee share scheme contact our team of Corporate Lawyers today.
Our Employee Share Scheme Expertise
Lanyon Bowdler has a team of experts who are dealing with the issues surrounding share incentive schemes on a regular basis. They are here to offer you the best-informed advice available so you can avoid any potential problems.
If your company has introduced or is thinking of introducing a share option scheme, you will need to keep up to date with the legal requirements and what needs to be done to comply with the appropriate legislation, and you’ll need to understand all the implications including those in relation to corporation tax and capital gains tax.
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Share Schemes for Private Companies
Private companies are generally less likely to offer a share option scheme because there isn’t a ready-made buyer to sell them on to, but private firms will often set up plans in anticipation of a trade sale or public offering.
Another option for private businesses is to set up an Employee Benefit Trust – an internal mechanism whereby shares can be bought from the employee and then sold to other employees.
What kind of employee share schemes are there?
Employee shares are normally shares in the employer company or in a parent company of the employer. There are a number of different types of share schemes available which can be tailored to meet the specific needs and goals of the company.
A number of schemes have the benefit of statutory tax relief. The Government set this up to encourage such schemes as it believes that shares held in the company you work for are good for the employee, the business and the wider community.
In some cases, share schemes can reduce employment costs with the offer of longer-term rewards through shares which can be used to partially replace a regular wage. It is also possible for companies to run a number of different employee share schemes for different categories of employees.
Share plans include:
- Save As You Earn (SAYE scheme)
- Enterprise Management Incentives (EMI scheme)
- Company Share Option Plan (CSOP scheme)
- Non-Tax Favoured Share Option Plan
Contact an Employee Share Scheme Lawyer today
We have offices in Shrewsbury, Telford, Oswestry, Ludlow, Hereford, Bromyard, and Conwy, where our friendly, knowledgeable staff will be happy to welcome you for an initial chat about your requirements. We work with businesses across Shropshire, Cheshire, Herefordshire, the Marches, Mid & North Wales, Birmingham, and the Midlands.
As a leading corporate law firm, we can represent your business interests wherever you are based in England or Wales.
For more advice about how we can help you please use the online enquiry form, and someone will get in touch with you.
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