WHAT IS THE ENTERPRISE MANAGEMENT INCENTIVE (EMI)?
The EMI scheme was introduced in 2000 and has since become a favourable option for employees and employers alike. Companies can grant employees share options of up to £250,000 in a 3-year period with no cash cost to the employee.
The EMI scheme provides employers and employees with generous tax breaks, incentivising employees to work hard to invest and make the business a success and allowing employers to retain talented employees.
Employees are given the right to buy shares in the company at the price it is valued at when offered the option. This gives employees the chance to make a hefty profit in the future if the value of the company increases.
Employees will not have to pay National Insurance or Income Tax on the shares if bought for the market value they had when granted the option. If you paid less than what it was valued for at the time, National Insurance and Income Tax will have to be paid on the difference.