How can I find the best employee share options for my company?
First, decide on your objectives. Are you looking to align the interests of key executives with shareholders, perhaps prior to a trade sale, MBO or flotation? Do you want to encourage a culture of team work across the whole organisation? Is saving tax or cash important?
Contact us on 020 8949 5522 for further advice or complete our Share Scheme Selector Tool, a four-questions survey.
Why should I seek advice from RM2?
RM2 has successfully implemented more than 1,150 employee share schemes. Unlike other share plan advisers, we are not just lawyers or accountants - we are true specialists covering every aspect of share scheme advice including tax, company law, trust law, accounting, tax valuations and (importantly) we offer full trustee and administration services as well. We are accredited to ISO 9001 for the design and administration of employee share schemes. We usually offer an initial consultation without cost or obligation.
My company is private - can I offer an employee share scheme?
Yes. If you are planning an exit event such as a trade sale or flotation in due course, this will provide a liquidity event to allow employees to retrieve their gains. If no exit event is planned, you can create an internal market for the shares - this is done through an employee benefit trust. As a private company you can benefit from the same tax and cash advantages as a quoted company.
What approvals does my share incentive plan require?
You will need Board approval and, depending on the nature of the scheme and any existing permissions you may have, you may require shareholder approval as well. RM2 will provide all the necessary Board and shareholder papers and ensure that all statutory filings are correctly made. Some tax advantaged schemes will need to be approved by HM Revenue & Customs before they can be set in motion.
For more information see Share Incentive Plan, SAYE Share Option Plan and Approved Company Share Option Plan.
Could my share scheme's tax advantages be withdrawn?
Parliament can always change the rules. However, all political parties, together with the TUC and the CBI, support employee share schemes. We believe it is very unlikely that tax benefits will be withdrawn from these schemes, and even less likely that benefits would be withdrawn from schemes already running. Indeed it seems each year there are enhancements and new reliefs conferred to encourage the wider use of such planning.
How much will it cost?
It is difficult to advise on this until we know what kind of scheme you are looking for. But we do know from survey information that our fees are consistently regarded as representing excellent value for money. It is hard for other advisers to match our offering competively as they invariably provide a less complete service.
How long will it take?
Most employee share incentive plans can be set up within 12 weeks. Generally, the key factor governing progress is the timing of the client's internal decisions, such as the dates of Board meetings. If shareholder approval is required this may extend the timescale, particularly if there are large numbers of shareholders.