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Impact on ESO from UK Budget

By April 13, 2017No Comments

There were no new direct changes to the employee share scheme legislation in the Spring Budget, but there were some announcements that may have significant longer-term impacts on employee share schemes, said ESOP Centre member Pett Franklin in the latest news blast from the Centre in April.

Enterprise Management Incentives (EMI): “Most welcome was the government’s announcement that it would, in 2018, seek approval for the continuation of the exemption from EU State Aid rules for EMI options to allow this tax relief to continue beyond 2018. Some had speculated that the government might take the expiration of the exemption in 2018 as an opportunity to withdraw EMI relief, so it is an encouraging sign that the government recognises that allowing a capital gains tax treatment on business growth through EMI options is important to sustain a vibrant private sector after Brexit. However, an extension of the exemption in 2018 requires EU co- operation and so concerns remain that achieving this exemption for EMI may be complicated by Brexit negotiations.