Employee share owners
From 6 April 2013 companies will be permitted to give shares worth between £2,000 and £50,000 to their employees, if in return those employees agree to give up certain employment rights. The new employee shares will be free of capital gains tax (CGT) on disposal, but other taxes could apply on acquisition.
Unfortunately the employee shares will not be exempt from CGT on a disposal if the employee, or a person connected with the employee, already holds 25% or more of the company. This will prevent small family companies from using the employee shareholder scheme to reward owner-directors or their relatives who work for the company. Talk to us about how employee shares could be used to reward employees of your company.