ARTICLE · 15 SEPTEMBER 2016

Enterprise Management Incentive (EMI) - August 2016

Smith & Williamson

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EMI is a highly tax-efficient means of rewarding, incentivising and retaining qualifying employees.

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Smith & Williamson

What is an EMI?

EMI is a highly tax-efficient means of rewarding, incentivising and retaining qualifying employees.

It is a tax-advantaged share option scheme for smaller listed and privately-held companies. The main benefit of EMI is that employees participate in share growth through an option without incurring an income tax or national insurance liability and at advantageous capital gains tax rates. There are also generous corporation tax advantages for the employer.

The employee may hold options over fully-paid shares up to the grant value of £250,000. The total grant value of unexercised EMI options that a company can issue is £3m. The company or group has to satisfy qualifying conditions including regarding the nature of its trade. Its gross assets may not exceed £30m and the full-time equivalent number of employees must not exceed 250.

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