All posts by Michael Deeks, Tax Partner, Olswang

The most common response to today’s announcements regarding the increase in the current statutory threshold in relation to cheap employer loans from £5,000 to £10,000 must surely be – finally! The legislation currently provides that employers may make cheap loans to employees (i.e. loans without interest or where interest is due at less than the … Continue reading Bringing employee loans into the 21st century

Under the Government’s proposed initiative to introduce the “employee shareholder” status, employee shareholders will relinquish certain statutory employment rights in return for shares in their employer company on the basis that any future gains on those shares will be exempt from UK capital gains tax. With the legislation implementing the new status expected to come … Continue reading Employee shareholders – just another tax break for senior executives?

On Tuesday the Treasury published the draft text of next year’s Finance Bill.  As was expected, this contained the specific provisions implementing the change to the scope of entrepreneurs’ relief relating to EMI share options that was announced last year.  However, as was not expected, the government has made a surprising but helpful U-turn in … Continue reading A sensible turnaround on Entrepreneurs’ Relief and EMI options

Despite the fact that the overwhelming response to its initial consultation on this issue was either negative or mixed, the Government today confirmed its commitment to implementing the employee owner status (which it has now decided to call the “employer shareholder” status). Under these provisions, employees will relinquish certain statutory employment rights in return for … Continue reading Employee owner status – a step in the right direction, but still flawed

Changes to the scope of Enterprise Management Incentives (“EMI”) options have been announced today which will expand the way in which employees can benefit from EMI options. Entrepreneurs’ relief is currently available to employees and directors who realise “qualifying gains” in respect of shares held in their employing company (or a member of its group). … Continue reading Entrepreneurs’ relief to apply to EMI shares

 The Government has today taken steps to improve and reform the current EMI legislation. The measures are designed to help small and medium enterprises who carry on a qualifying trade recruit and retain high calibre employees. The government has said it will increase the value of tax-advantaged EMI options that can be held by an … Continue reading Enterprise Management Incentives Schemes (“EMIs”)

 As widely predicted, the highest (“additional”) rate of income tax will be reduced from 50% to 45% from 6 April 2013. Given that the introduction of the additional rate has not delivered the additional tax revenues expected, it will be interesting to see if this 5% reduction is sufficient to prevent taxpayers from taking steps … Continue reading Reduction of 50% income tax rate and impact on employee share plans

In today’s budget, the Government has stated that it will consider and consult on the recommendations of the Office of Tax Simplification (“OTS”) relating to ways to simplify the tax legislation applying to tax advantaged share schemes in the UK. By way of background, on 6 March 2012, the OTS firstly recommended the introduction of … Continue reading Tax Simplification

From an Incentives perspective, the only real substantive points from today’s Budget relate to entrepreneurs’ relief and the eagerly awaited release of the controversial draft legislation on “disguised remuneration”.  As Natasha has already blogged, whilst the increase in the entrepreneurs’ relief lifetime limit to £10m is welcomed, the Chancellor’s decision not to remove or decrease … Continue reading Incentives Update

As Natasha says, the Chancellor has elected to “keep it simple” by raising the CGT rate for high earners from 18% to 28%, effective from midnight tonight.  Taking into account the proposed increases in National Insurance contributions (NICs) rates from April 2011, the effective rate of income tax and NICs payable on unapproved share plans (where … Continue reading Impact of CGT rate increases on employee share incentives