The Business Bulletin
How can an Enterprise Management Incentive scheme benefit my business? An Enterprise Management Incentive, or EMI, is a government‑backed, tax-advantageous employee share scheme.
This scheme is available to most
to acquire shares at a pre-
trading companies looking to share
determined price at some future
shareholder for their shares when
their successes and incentivising their
point in time and on certain
they can exercise their option will be
team as the company grows. An EMI
conditions. At this time, they do
the number of share options they
scheme offers significant tax incentives
not become actual shareholders.
hold multiplied by the approved
for employers and employees, provided certain qualification criteria are met. Businesses are also able to set specific conditions for recipients, such as performance or length-ofservice milestones. These schemes can offer flexibility, in terms of both the conditionality and the time frames that can be set as part of their terms.
■ Exercise of options over shares –
ownership: ■ Options over shares – this gives qualifying employees a right
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option price.
with all necessary pre-conditions met, the option over shares is exercised, the participating employee pays the option price for the shares and becomes a shareholder of the company. ■ The employee sells the shares acquired.
EMI Basics There are three stages to share
The price paid by each EMI option
The Option Price
What is a “Qualifying Employee”? To be a qualifying employee, you must either: ■ Work for the company for a minimum of 25 hours per week, or; ■ Work at least 75% of your total working time for the company.
Preparation and submission of VAL231
So, for example, if you work 20
Form agreeing on the market value of
hours per week for the New
the shares with HMRC.
Company and 5 hours per
