The following Share Incentives practice note provides comprehensive and up to date legal information covering:
EMI Review: In the Spring Budget 2020, the government announced that it will review the EMI scheme to ensure that it provides support for high-growth companies to recruit and retain the best talent so they can scale up effectively, and to examine whether more companies should be able to access to the scheme. This suggests that the government may be considering less restrictive eligibility criteria for companies who wish to offer an EMI scheme, therefore potentially increasing the number of companies who qualify to operate EMI schemes. See News Analysis: Spring Budget 2020—Tax analysis.
The enterprise management incentives (EMI) scheme is a highly flexible and tax-efficient 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.
Employees selected to participate in an EMI scheme are granted an option to buy shares in a company, paying a fixed price if they do decide to buy the shares (exercise the option). Often, but not necessarily, the exercise price will be equal to the value of the shares at the time the EMI option is granted. There is no obligation for the employee to exercise the option.
While EMI schemes, if implemented correctly, are very tax efficient, the criteria to qualify to grant and be granted EMI
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Fraud by false representationFraud by false representation applies to a broader range of conduct than the offences under the preceding legislation (the Theft Act 1968 (TA 1968)). No gain or loss need actually be made, and no deception need operate on the mind of the deceived for the Fraud Act 2006
What is a company's constitution?A company’s 'constitution' is defined under the Companies Act 2006 (CA 2006) as including:•the company’s articles of association, and•any resolutions and agreements affecting a company’s constitutionThe CA 2006 definition of 'constitution' is not exhaustive and also
BREXIT: As of exit day (31 January 2020), the UK is no longer an EU Member State. However, in accordance with the Withdrawal Agreement, the UK has entered an implementation period, during which it continues to be subject to EU law. This has an impact on this Practice Note. For further guidance on
Definition of automatismAn act is done in a state of automatism if it is done by the body without control by the mind, (eg it is a spasm or a reflex), or if it is done by a person who is not conscious of what they are doing. The act may be described as involuntary, but will not be regarded as such
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