EMI Share Option Schemes

The "Enterprise Management Incentive" (EMI) share option scheme generally offers the most effective share option format for entrepreneurial companies.

They are a way of giving key employees in fast-growing companies the opportunity to be paid largely in shares rather than by way of salary.

The benefits to the owners of the company are also substantial as they can realise the future value of a proportion of their shares at capital gains tax rates, often 10% if covered by Entrepreneurs' Relief, whilst tying key staff in to drive the growth of the company.

The company over which the options are issued can generally claim a deduction against its profits for the uplift in the value of the shares over the option's life.

Companies expecting high growth and with key staff should contact Eaves and Co as we have extensive experience of implementing these arrangements and maximising their efficiency.

Recent changes should also make it easier for employees to benefit from Entrepreneurs's Relief on shares acquired through EMI Schemes.

“The hardest thing to understand in the world is income tax”

Albert Einstein