Private Companies
Most of RM2’s clients are private companies; many were previously unaware of the full range of benefits available from employee share schemes.
In addition to incentivising and retaining key employees, share schemes can deliver large tax savings and conserve cash.
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Low tax cash benefits
Smaller companies often use employee share schemes to build shareholder value prior to a trade sale, MBO or flotation. But if the scheme is set up with an employee benefit trust, it can usually deliver low tax cash benefits even if no exit is achieved. Employee trusts can also deliver tax-planning opportunities for company proprietors.
The right share scheme advice
Accountants and solicitors sometimes offer employee share scheme advice. However they often lack in-depth experience of the specialised legal drafting required: solicitors may also struggle with company strategy, succession planning, valuation and accounting issues. In addition, most firms have little or no appetite for share scheme administration – this is easy to get wrong, and may cause loss of tax benefits.
By contrast, RM2 offers the full service: detailed administration as well as fully comprehensive design and implementation. Meet the team.
Best employee share schemes for smaller companies
The most popular share option scheme for smaller companies is the government sponsored Enterprise Management Incentive. However the qualification requirements are complex and can be baffling. Many EMI schemes already in place will ultimately fail for technical reasons. If you already have a scheme, why not contact us for a low cost audit.
Share options are not the only solution. Depending on your objectives you may wish to consider an employee trust based scheme or a share purchase scheme. Click here for advice on choosing the best scheme for your requirements.
