Can growth shares be combined with an EMI or CSOP?

Yes, and where the company qualifies it is often the better route. Granting EMI or CSOP options over growth shares has several advantages:

• employees do not have to buy shares at the outset or create an up-front tax liability;
• if someone leaves before an exit, it is far easier to lapse an option than to buy shares back;
• the value of the growth shares can be agreed with HMRC in advance, which is not possible for a standalone growth share plan;
• the options carry their own tax advantages for both employee and company.

It also helps larger companies work within the CSOP £60,000 limit, since growth shares have a low value at the outset but significant potential once the hurdle is passed.