Employee Share Schemes

1
Employee Share Schemes

• Philip Fisher
• Employee Benefits Partner

2
Recruitment and Retention

• Motivate key people
• Retain key people
• Incentivise all staff
• Tax breaks
• Pay-off on float or sale
• Start again

3
HMRC Approved Schemes

• Enterprise Management Incentives (EMI)
• Share Incentive Plans (SIPs)
• Company Share Option Plans (CSOPs)
• Sharesave (SAYE)

4
Unapproved Schemes

• Share options
• Direct shareholdings
• Restricted shares
• Partly paid shares
• Phantom share options

5
EMI Schemes

• Selective
• 100,000 per individual/3m per employer
• Qualifying trades/30m Gross assets
• Freedom
• No tax on grant
• No tax on exercise maybe
• CGT on sale
• Taper relief from grant

6
SIPs

• All employee
• Shares
• Free shares - 3,000
• Partnership shares - 1,500
• Matching shares - 3,000
• Dividend shares - 1,500
• In trust for five years

7
CSOPs

• Selective
• 30,000 per person
• Minimum exercise price
• 3 years minimum period
• Taper from exercise

8
Sharesave

• Linked to SAYE scheme
• Monthly savings
• 3/5/7 years
• Linked to share option

9
Takeovers

• Read the rules
• Exercise?
• Rollover?
• Buy out options?

10
Floats

• Insider information
• Closed periods
• Option exercise
• Stock Exchange requirements

11
International Considerations

• Mobile Staff
• Differing tax regimes
• Hidden pitfalls
• Tax planning

12
ABI Guidelines

• Only Guidelines
• Public companies should comply
• Timing of grants
• Restrictive
• Length and price of options
• Performance conditions
• Total shares

13
Philip Fisher Employee Share Schemes

• pfisher_at_cvdfk.com
• www.cvdfk.com