Introduction

In order to qualify for the tax breaks that enterprise management incentives (EMI) bring, companies have to meet a number of requirements.

The legislation for qualifying companies is covered in ITEPA 2003, Sch 5, paras 8–23.

For more on the reasons for using EMI schemes, see the Why use an enterprise management incentive (EMI) scheme? guidance note.

The requirements broadly fall into three categories:

1. •

   the size of the company / group and its structure

2. •

   the terms of the option

3. •

   the nature of the company / group trade

HMRC guidance on qualifying companies is at ETASSUM52010 onwards.

Please note that on 26 November 2025 (Budget Day), the Government announced changes to some of the limits which apply to EMI schemes.

For qualifying companies, for EMI contracts entered into on or after 6 April 2026:

1. •

   company options will be increased from £3m to £6m

2. •

   gross assets will be increased from £30m to £120m

3. •

   the number of employees will be increased from 250 employees to 500 employees

Also,