The enterprise management incentive scheme or ‘ EMI’ allows your employees to participate in the future capital growth of your business, without the upfront income tax charge applied when shares are gifted or bought for less than current market value.
If structured correctly EMI can offer an effective way to retain and give incentive to key staff.
Under EMI employees receive share options which they can exercise in the future. The value of the shares is agreed when the option is granted and is fixed.
Provided the employees pay at least this amount to exercise their options no income tax or NIC is due. The shares when acquired, automatically qualify for entrepreneurs relief giving a 10% tax rate on profits.
There are a variety of ways in which EMI share options can be used to provide an incentive to employees. For more information, please contact Lesley Sutton on 01484 550037 or email firstname.lastname@example.org.