The following Employment Tax guidance note Produced by Tolley in association with Andrew Rainford provides comprehensive and up to date tax information covering:
When compared with other tax-advantaged employee share schemes, Enterprise Management Incentive (EMI) has historically been relatively simpler both to set up and administer. This follows the principle that it is meant to be an inclusive scheme for smaller companies and therefore does not attempt to discourage those that might be tempted to try it out. Finance Act 2014 removed the formal approval process from all of the tax-advantaged schemes, instead moving toward a system of self-certification. This means that the benefits of simple set-up requirements which have long been enjoyed by EMI schemes are now enjoyed by the other schemes (SIPs, CSOPs and SAYE).
The several different stages of the process that do not necessarily need to be operated in a strict linear order are the following:
establishing that the company / group qualifies
devising and structuring the plan
agreeing a share valuation
drawing up an agreement or scheme rules
presenting the scheme to staff
notifying HMRC electronically
monitoring the scheme and completing annual returns electronically
Inevitably, the first step is to decide on whether EMI is even a possibility. If the company is too large, carries on the wrong trade or the individuals that the company would like to include are not eligible, then an EMI scheme is not appropriate. See the EMI qualifying conditions for companies guidance note.
Companies need to plan carefully in advance before implementing an EMI scheme. They should ideally establish what they are trying to achieve before taking any further steps.
The first question might be ‘which employees are they trying to include?’. Is this merely intended to be a scheme for a couple of key individuals or will it extend to the second-tier of management, or possibly all employees?
The company must also decide whether options are to be granted at a discount to the existing market price at current value or at an aspirational figure that may well not offer that
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
The majority of state benefits (also called social security benefits) are managed by the Department of Work and Pensions (DWP) via the Jobcentre Plus.Some benefits are dependent on a national insurance contribution record (and different classes of national insurance provide different benefit
From 6 April 2015, an individual can elect to transfer 10% of the personal allowance (£1,250 in 2020/21 and 2019/20) to the spouse or civil partner where neither party is a higher rate or additional rate taxpayer. The legislation calls this the ‘transferable tax allowance’ but the GOV.UK website
Expenditure of a capital nature is not allowed as a deduction when calculating trading profits. Expenditure of a revenue nature is allowable, provided there is no specific statutory rule prohibiting a deduction and the expenditure also satisfies the wholly and exclusively test. See the Wholly and
The rent-a-room scheme was introduced in the early 1990s to encourage homeowners to take in lodgers.Fundamentally, the rent-a-room scheme is a relief which means that the rent received by an individual from a lodger (up to a prescribed limit) can be exempt from income tax. If the gross rents are
To view our latest tax guidance content, sign in to Tolley Guidance or register for a free trial.