EMI schemes ― qualifying conditions for companies

Produced by Tolley in association with

Employment Tax

Guidance

Introduction

In order to qualify for the tax breaks that enterprise management incentives (EMI) bring, companies have to meet a number of requirements.

The legislation for qualifying companies is covered in ITEPA 2003, Sch 5, paras 8–23.

For more on the reasons for using EMI schemes, see the Why use an enterprise management incentive (EMI) scheme? guidance note.

The requirements broadly fall into three categories:

•
the size of the company / group and its structure
•
the terms of the option
•
the nature of the company / group’s trade

HMRC guidance on qualifying companies is at ETASSUM52010 onwards.

Size and structure

Independence

In order to qualify, the company whose shares are being granted must not be a 51% subsidiary of any other company. Care must be taken to go beyond merely ensuring that current shareholdings meet this rule. When determining the shares that a company holds, it is necessary to look at not only their own shares but also those of associates (a concept which is extremely widely

Continue reading the full document

To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™

TAKE A FREE TRIAL NOW

Oliver John

Director at Azets , Employment Tax

Oliver John was previously at Mazars for just more than five years where he provided tax and share valuation advice to a range of businesses with regards to share transactions. In his role as director at Azets, Oliver will continue to share tax advice with clients over the life of a business, from companies looking to raise capital to shareholders looking to exit.

Popular Articles

Value Added Tax

Payments on account (POA)

Payments on account (POA)This guidance note provides and overview of the payments on account regime (POA). More in depth commentary can be found in De Voil Indirect Tax Service V5.110.What are payments on account?VAT registered businesses with an annual VAT liability of more than £2.3m are required

14 Jul 2020 12:52 | Produced by Tolley Read more

Value Added Tax

Supplies of goods and services connected with education

Supplies of goods and services connected with educationThis guidance note provides an overview of the VAT treatment of goods and services provided in connection with supplies of education. This should be read in conjunction with the following guidance notes:•Supplies of education•Local authority

14 Jul 2020 13:44 | Produced by Tolley Read more

Personal Tax

Maintenance payments

Maintenance paymentsMaintenance payments are payments made by a taxpayer to their former or separated spouse / civil partner for the maintenance of that person or their children. To obtain any tax relief for maintenance payments, one of the couple must have been born before 5 April 1935 and the

14 Jul 2020 12:12 | Produced by Tolley Read more

��˾��ҹ��