The enterprise management incentive (EMI) individual limit increase, from £120,000 to £250,000, will take effect on 16 June 2012.
The increase, which was announced in the 2012 Budget, will allow qualifying organisations to grant EMI options to employees over shares with a value up to £250,000.
Employers that have already granted EMI options up to the existing maximum of £120,000 will be able to grant additional options to relevant employees up to the new maximum, providing the existing rules of the EMI plan do not expressly limit the maximum grant of options to £120,000.
In the event the existing EMI rules contain such a limitation, an amendment to the rules will be necessary to enable the grant of EMI options up to the increased limit.
Read more articles on employee share schemes
Share options are not rocket science. With the benefits on offer, every ambitious company that qualifies for EMI should be getting to grips with how it works.
Because it’s so flexible, companies can tailor the scheme to fit their needs. At one end of the scale we have seen fully employee-owned companies offer EMI to every employee and at the other it can be used to motivate a handful of key executives towards achieving a sale within a couple of years.
We hope the government will increase the company limit of £3 million for options granted at any one time. This will encourage directors to think about extending their scheme beyond management. The larger the cake, the more slices can be cut.
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