Set up employee share schemes

Introduction

An employee share scheme is one way for companies to give employees a real stake in the business and help to improve its performance.

As employees normally have to remain with the business to get this benefit, share schemes encourage loyalty and can help you retain valued staff. They act as an incentive or reward and may also help recruitment. HM Revenue & Customs tax-advantaged (approved) schemes are a tax - and National Insurance - efficient way to offer employees shares in the company.

This guide examines the various share award and share option schemes, including tax-advantaged and taxed (approved and unapproved) schemes. It also examines their benefits and potential pitfalls, and gives information on how to choose and manage a scheme that suits your business.

It's a good idea to talk to your legal or financial adviser about the tax and National Insurance implications of different employee share schemes before introducing one.

Subjects covered in this guide

• Introduction
• Defining share option and share award schemes
• Employee share ownership - for employers
• Employee share ownership - for employees
• Different schemes - an overview
• HM Revenue & Customs-approved schemes: CSOP and EMI
• HM Revenue & Customs-approved schemes: SIP and Save As You Earn
• Taxed employee share schemes - taxed, phantom and long-term incentive share plans
• Taxed employee share schemes - restricted, convertible and benefit trusts
• Choosing the best share scheme for your business
• Set up a share scheme
• Here's how I set up a successful employee share scheme

Warning: main(http://www.encorepersonnel.co.uk/inc/php/page_functions.php) [function.main]: failed to open stream: Connection refused in /home/sites/encorepersonnel.co.uk/public_html/hrportal/motivation/share-schemes/index.php on line 208

Warning: main(http://www.encorepersonnel.co.uk/inc/php/page_functions.php) [function.main]: failed to open stream: Connection refused in /home/sites/encorepersonnel.co.uk/public_html/hrportal/motivation/share-schemes/index.php on line 208

Warning: main() [function.include]: Failed opening 'http://www.encorepersonnel.co.uk/inc/php/page_functions.php' for inclusion (include_path='.:/usr/share/pear') in /home/sites/encorepersonnel.co.uk/public_html/hrportal/motivation/share-schemes/index.php on line 208