Buckworths advises start-ups, scale-ups, and high-growth businesses on employee share schemes and equity incentives. We design and implement share incentive structures that support business growth and allow employees to share in the company's success in a tax-efficient way.
We advise on Enterprise Management Incentive (EMI) option plans, unapproved option schemes, reverse vesting arrangements, and company share structures.
Book a free consultation to discuss your employee share scheme.
Employee Incentivisation Services
FAQs
An Enterprise Management Incentive scheme allows start-ups and growing companies to grant tax-efficient share options to employees. Employees pay Capital Gains Tax rather than Income Tax on any gain. With Business Asset Disposal Relief, the CGT rate is 18% on the first £1 million of lifetime gains, far lower than the Income Tax rates of up to 45% on unapproved options. The scheme expanded in April 2026 and is now available to a much wider range of businesses. We advise on EMI scheme design and implementation across the UK.
To qualify for EMI, your company must have gross assets of no more than £120 million, fewer than 500 full-time equivalent employees, and carry on a qualifying trade. The total value of shares a company can issue under EMI is £6 million, and options must be exercisable within 15 years of grant. Certain trades are excluded, including financial activities, property development, and legal services. These expanded thresholds mean many scale-ups that previously did not qualify may now be eligible. We assess eligibility quickly and advise on alternatives where EMI is not available.
Setting up an EMI scheme typically takes three to four weeks from instruction to grant, assuming the company qualifies and HMRC valuation approval is obtained in advance. We manage the entire process and aim to complete within your timeline.
EMI options carry significant tax advantages: employees pay Capital Gains Tax rather than Income Tax on any gain. Unapproved options do not carry these tax advantages but can be granted to a wider group, including non-employees, overseas staff, and consultants. We advise on which approach suits your business and draft the necessary documentation.
Reverse vesting protects the company if a founder or key employee leaves early. Shares are issued upfront but the company retains the right to buy them back at a nominal price or convert them into a new class of share carrying no rights if the individual leaves before a specified period. We draft reverse vesting provisions tailored to your specific circumstances and the individuals involved.