The Chancellor recently answered an online question, regarding the tax ad, which represents the employee ownership industry, found that employees found the five-year holding period for the Share Incentive Plan (SIP) to be too long before being able to sell shares tax free and it...
Do you know that you should register your share plan with HRMC’s Employment Related Securities Service (“ERS”)? Do you know that an annual return is due by 6th July each year for each type of plan you operate e.g. Enterprise Management Incentive Plan (“EMI”), Share...
Fallings out between founders is sadly quite common among start-ups. What is just as frustrating is where there is no prior agreement on how to break the deadlock and move on – often with the result that continuing founders have to buy out other founders...
The government recently announced a review of the share buyback rules, intended to identify whether the rules are being abused by companies to inflate company value, thus justifying increased executive pay. For more information, see here. For unquoted companies, buybacks – ie the purchase of own...
We recently published an outline checklist for putting in place an employee share plan. Step one on that checklist is producing a blueprint for the design of the employee share plan. This is important not just to get the design of the employee share plan right...
One of the issues raised in connection with the Carillion story in the last couple of days is the bonuses paid to directors which, by all accounts, can’t be clawed back despite the disaster that’s befallen the company. It seems unlikely that clawing back directors’ bonuses...
One of the first questions we often get from business owners looking into potentially selling their company to an Employee Ownership Trust, or EOT, is how is the sale financed? This is an important question, as often the vendor is also looking at a third-party...
Traditionally, as the year ends, RM2 takes a look at the highlights of the year in share schemes. This year, we thought we’d break with tradition and focus on the most important highlight – our clients. We are lucky enough to work with a huge variety of...
Some of the details needed in an EMI option agreement are self-explanatory – typically, these details include the number of options granted, the date of grant, and the name of the optionholder. HMRC’s website has a useful summary here: EMI options - terms to be included. It’s...
The number of Employee Ownership Trusts has increased to more than 150, according to the latest results from the national survey of EOTs, compiled by RM2 for the Employee Ownership Association. The current rate of growth in EOTs is 50% per annum, reflecting keen interest from...
It is noticeable that, while almost all the tax-advantaged share plans (CSOP, SIP and SAYE) and “Employee Ownership Trust” (EOT) arrangements make reference to “trading activities” (in the context of the scope of appropriate activities of a relevant company), it is only the Enterprise Management...
This part of the series looks at dilution, or rather protecting specific groups from dilution. You can set up an employee share scheme to protect specific groups from dilution, but I'll explain below why keeping things simple (and not offering dilution protection to employee shareholders)...
Worry about what happens to an employee's options or shares when they leave can often lead to unnecessary complexity. This is the second in a series of posts looking at some of the common barriers to a simple employee share scheme. Why is it hard to keep...
I love simple share scheme designs – they’re easier to manage, easier to explain to participants and more reliably produce the intended outcome. Why is it hard to keep it simple? Keeping it simple isn’t easy – the government already throws enough complexity at businesses in the...
It has always been the case that all UK trusts must be registered with HMRC. The registration must be made by 5th October following the tax year in which the trust was established. Up until recent times the completion of a paper form 41g would suffice...
