This Practice Note details the following: • the EMI annual return form • the pre-registration and timing of completion of the annual return • reportable events • nil returns • unapproved options • penalties for non-compliance • common ERS annual return errors • employee's self-assessment obligation, and • obtaining further information For a Practice Note addressing the separate process (and different form) used to notify the grant of EMI options to HMRC, see Practice Note: EMI—notification of grant of options to HMRC. It was announced as part of the Budget on 26 November 2025 that the requirement for the grant of EMI options to be separately notified to HMRC will be removed. Instead, EMI options will have to be notified in the end of year EMI annual return form in order for them to take effect as tax-advantaged qualifying options. This will apply in respect of options granted on or after 6 April 2027, whose grant will have to be included in an EMI annual return from 6 April 2028. The relevant legislation will form part

FORTHCOMING CHANGE: On 26 November 2025, as part of Budget 2025, it was announced that the requirement for the grant of EMI options to be separately notified to HMRC will be removed. Instead, EMI options will have to be notified in the end of year EMI return in order for them to take effect as tax-advantaged qualifying options. This will apply in respect of options granted on or after 6 April 2027, whose grant will have to be included in an EMI annual return from 6 April 2028. The relevant legislation will form part of the Finance Bill 2027, and was published in draft on 13 July 2026. See: Budget 2025, para 4.40 and Enterprise Management Incentives (EMI): simplification of the process to grant options. Enterprise management incentives (EMI) schemes are tax advantageous discretionary share option schemes used widely in the UK. EMI schemes have the potential to provide very generous tax treatment and allow for generous individual awards. However, the EMI legislative requirements are strict and the grant notification obligation is imperative to

The EMI regime is prescriptive and sets out numerous requirements that must be met at the time the options are granted, including in relation to: • the company granting the options • the employees being granted the options • the shares being placed under option, and • the options themselves This Practice Note focuses on the conditions that must be met in relation to companies granting the EMI options. These conditions are described in the context of the income tax relief provided for in sections 527–541 of the Income Tax (Earnings and Pensions) Act 2003 (ITEPA 2003). For a flowchart to help illustrate whether a company qualifies to grant EMI options, see: EMI scheme—flowchart to determine company's eligibility. For a checklist to help establish whether a company and its employees qualify to grant/receive EMI options, see: EMI options—checklist to determine whether a company and its employees qualify and for a questionnaire to do the same, see Precedent: Enterprise management incentives (EMI) qualification questionnaire. For details of the other EMI eligibility conditions, see Practice Notes: • EMI—requirements for options, and

The enterprise management incentives (EMI) scheme is a highly flexible and tax-efficient scheme designed specifically for small/medium-sized companies. The EMI regime is prescriptive and sets out numerous requirements that must be met at the time the options are granted, including in relation to: • the company granting the options • the employees that are being granted the options • the shares being placed under option, and • the options themselves This Practice Note focuses on the conditions that must be met for the options themselves to qualify as EMI options. It assumes that all other eligibility criteria have been met. These conditions are described in the context of the income tax relief provided for in sections 527–541 of the Income Tax (Earnings and Pensions) Act 2003 (ITEPA 2003). For details of the other conditions, see Practice Notes: • EMI—qualifying companies • EMI—trading activities, and • EMI—what makes an employee eligible? For an explanation of the various tax reliefs available to qualifying EMI options, see Practice Notes: Enterprise management incentives (EMI)—income tax and NIC treatment of options,

The criteria for an enterprise management incentives (EMI) rollover are complex. This Practice Note examines: • what is an EMI rollover? • the reasons for using an EMI rollover • the circumstances in which an EMI rollover can be used • the eligibility criteria which must be satisfied for an EMI rollover, including: ◦ the eligibility criteria in relation to the acquiring company ◦ the eligibility criteria in relation to the employees, and ◦ the eligibility criteria in relation to the options • the timing of an EMI rollover • the effect of granting replacement options, and • common misunderstandings and mistakes relating to EMI rollovers For a checklist to help establish whether EMI options over shares in a company that is subject to a change of control may be exchanged for options on the same terms over shares in the acquiring company, while still retaining the legislative tax advantages of EMI, see: EMI options—checklist for rollover of options. For a practical step-by-step ‘how to’ guide to exchanging existing EMI options

[insert option holder’s name] [insert option holder’s address] Dear [insert option holder’s name] Offer to roll over an option granted under [insert name of scheme/details of the option agreement pursuant to which the option was granted] (EMI Scheme) 1 Introduction 1.1 We refer to: 1.1.1 the proposed acquisition of [insert name of company whose shares are currently under option] (Company) by [insert name of acquiring company] (Acquiring Company and Acquisition) and 1.1.2 the EMI option over [insert number of shares originally granted under option and the class of shares] shares in the Company (Option) granted to you pursuant to an option agreement dated [insert date of the option agreement pursuant to which the original option was granted] (Option Agreement). 1.2 This

The enterprise management incentives (EMI) regime is prescriptive and sets out numerous requirements that must be met at the time the options are granted, including in relation to: • the company granting the options • the employees being granted the options • the shares being placed under option, and • the options themselves This Practice Note analyses the legislative detail of the trading activities test that companies must satisfy in order to grant EMI options. The Practice Note explains what is meant by a qualifying trade and it highlights relevant HMRC guidance and practical issues relating to it. For details of the EMI qualifying tests relating to a company’s independence, qualifying subsidiaries, gross assets and number of employees, see Practice Note: EMIs—qualifying companies. For a flowchart determining a company's eligibility to grant EMI options, see: EMI scheme—flowchart to determine company's eligibility. For a checklist to determine whether a company and its employees qualify for EMI purposes, see: EMI options—checklist to determine whether a company and its employees qualify. For details of the other EMI qualifying conditions,

The enterprise management incentives (EMI) scheme is a highly flexible and tax-efficient scheme designed specifically for small/medium-sized companies. The EMI regime is prescriptive and sets out numerous requirements that must be met at the time the options are granted, including in relation to: • the company granting the options • the employees being granted the options • the shares being placed under option, and • the options themselves This Practice Note focuses on the conditions that must be met for an employee to qualify to be granted EMI options. These conditions are described in the context of the income tax relief provided for in sections 527–541 of the Income Tax (Earnings and Pensions) Act 2003 (ITEPA 2003). For an explanation of the various tax reliefs available to qualifying EMI options, see Practice Notes: EMI—income tax and NIC treatment of options, EMI—CGT, including business asset disposal relief, and corporation tax relief and EMI and disqualifying events. For a flowchart illustrating whether an employee qualifies to be granted EMI options, see: EMI scheme—flowchart to determine employee's

Electricity Market Reform: The programme of reform to the wholesale electricity market initiated by the White Paper Planning our electric future: a White Paper for secure, affordable and low-carbon electricity published in July 2011. The EMR proposals have altered during the process of consultation and pre-legislative scrutiny, but the four key proposals are: (a) the introduction of Contracts for Difference (CfD) Feed-in Tariffs to replace premium Feed-in Tariffs for medium to large-scale renewable energy generating stations, including nuclear, under which a generator will enter a long-term contract based on a pre-determined "strike price" and will receive variable payments to ensure it receives the agreed tariff; (b) a Capacity Market through which the total amount of back-up capacity needed to ensure security of supply will be bought through a central competitive auction conducted by the National System Operator a number of years in advance; (c) an Emissions Performance Standard to apply to all new fossil fuel power stations over 50MW which will place a limit on the amount of CO2 emitted to a maximum of 450gCO2/kWh; and (d) a Carbon Price Floor (introduced through provisions in the Finance Act 2011) which consists of EU ETS price and the Carbon Support Price. The Carbon Price Floor was originally intended to raise the price of carbon to around £15.70/t CO2 in 2013 to £30/t CO2 in 2020. In 2014 however the UK Government announced that the Carbon Support Price element would be capped at £18t/tCO2 until 2020 which has subsequently been extended until 2021.

The Energy Networks Association (ENA) has published a connections data dashboard in relation to the TMO4+ grid connection reforms in Great Britain. The dashboard is designed to increase transparency for customers and to track the progress of Gate 2 to Whole Queue (G2TWQ) connections data at 1MVA/1MW and above across both transmission and distribution networks. The initial data focuses on the issuing of protected project connection offers and sets out indicative timeframes for offers in line with the connections reform timeline. The dashboard will be updated regularly as further data is collected from National Electricity System Operator (NESO) and the transmission and distribution networks.

Emirates Nuclear Energy Corporation: Established to evaluate and implement nuclear power within the UAE and offer joint-venture arrangements to foreign investors for the construction and operation of future nuclear power plants.

The EU Agency for Cybersecurity (ENISA) has launched a survey aimed at micro, small and medium-sized enterprises (SMEs) to assess their readiness for implementing Regulation (EU) 2024/2487 (the Cyber Resilience Act (CRA)), which will apply from December 2027. The CRA introduces cybersecurity requirements for all products with digital elements placed on the EU market. The survey covers five areas: company profile, levels of awareness and readiness, existing cybersecurity practices, preferred support and communication channels and the maturity of CRA-relevant practices. The findings will support ENISA and the European Commission in developing targeted support measures, including awareness campaigns, training materials and tailored guidance, and provide evidence-based input to inform national and EU-level discussions on CRA implementation.