Our regular update highlights key current issues affecting share schemes and other incentive plans.

Enterprise Management Incentives: have you got one yet?

Enterprise Management Incentives (EMI) plans are one of the most tax advantageous methods available for enabling employees to own shares in your company.

Under an EMI plan, qualifying companies may grant options to selected employees over shares worth up to £100,000 per employee (measured at the date of grant).

Provided the options are granted at market value, no income tax or national insurance contributions are payable on grant or exercise. Instead, employees pay capital gains when the shares are sold, on the sale proceeds less the price they paid to acquire the shares. In addition, business asset taper relief runs from the date of option grant rather than the date of exercise.

EMI plans are very flexible and the exercise of the options can be subject to performance targets (individual or corporate) and/or dependent on the sale or flotation of the company.

Talk to us about whether your company would qualify for an EMI plan and the benefits and best methods of implementing one.

Click here for further information on EMI's


Age discrimination: share scheme audits

Age discrimination legislation comes into force on 1 October 2006. It will impact on any share incentives and other benefits provided to employees which contain age-related rules.

Companies will need to ensure that share options and awards are compliant with the new legislation. In addition to Lewis Silkin’s general fixed-price age discrimination audits, we offer a service specifically designed to give your share scheme a clean bill of health. We will review your scheme rules, recommend changes and, on your instructions, make any necessary amendments. We’ll also liaise with HMRC on your behalf where appropriate.

For further information on age audits, please click here

For further information on any of these topics, please contact our incentives partner Sara Cohen