HMRC recently announced that EU State Aid approval for Enterprise Management Incentive (EMI) share options expired on 6 April 2018, and that options granted after that date may not therefore be eligible for the tax advantages afforded to the EMI scheme until state aid approval is reinstated.
Any options issued on or after 7 April 2018 may instead be treated as non-tax advantaged employment related securities. Clearly this is not good news.
HMRC have indicated that EMI options granted up to and including 6 April 2018 should not be affected. However, we would suggest delaying the grant of any EMI Share options until state aid approval has been renewed.
This is clearly an unsatisfactory position, and we don’t yet have confirmation as to when EU approval will be reinstated, although we are advised by the government that they are working to obtain approval as soon as possible.
Should you have any questions relating to EMI share options, and how this may impact on your plans to implement an EMI scheme, then please do not hesitate to contact a member of the business tax team, or your usual Ryecroft Glenton adviser.