The following Share Incentives guidance note provides comprehensive and up to date legal information covering:
The Practice Note covers the following topics and questions:
what are EMI options?
the law governing EMI options
the eligibility requirements:
which companies can grant enterprise management incentives (EMI) options?
who can be granted EMI options?
which shares can EMI options be granted over?
what must the exercise price be?
are there any limits on the grant of EMI options?
when can EMI options be exercised?
when do EMI options lapse?
are there any restrictions in regard to the terms of an EMI scheme?
amending the terms of an EMI option—possible pitfalls
tax treatment of EMI options:
income tax and National Insurance contributions (NICs) treatment
capital gains tax (CGT) treatment of EMI options
exchange (rollover) of EMI options
valuation of EMI options
annual returns, and
EMI options and corporate transactions—practical considerations
The EMI scheme is a highly flexible and tax-efficient share option scheme designed specifically for small/medium-sized businesses. EMI schemes, which were first introduced under the Finance Act 2000, are one of the most popular of the share option schemes available to companies.
EMI options must be granted for commercial reasons in order to recruit or retain an employee in a company, and not as part of a scheme or arrangement the main purpose (or one of the main purposes) of
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