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Employee share option schemes look set to become simpler for companies to handle, as the government considers implementing a recommendation from the Office of Tax Simplification (OTS).
A consultation document seeks views on a new vehicle to make it easier for businesses wishing to manage their workers’ share arrangements and create a market for employee shares.
Employee share option schemes look set to become simpler for companies to handle, as the government considers implementing a recommendation from the Office of Tax Simplification (OTS).
A consultation document seeks views on a new vehicle to make it easier for businesses wishing to manage their workers’ share arrangements and create a market for employee shares.
The measure is based on a 2013 suggestion by the OTS and is intended to allow shares in unquoted companies to be held and traded more easily on behalf of their staff members and at a reduced cost, without the perceived hurdles for existing employee benefit trusts.
The government is particulary interested in gathering views on:
- level of demand for such a vehicle;
- relative need and demand for the exemptions recommended by the OTS;
- effectiveness of the safeguards for the Exchequer; and
- whether further safeguards might be necessary to protect against avoidance.
Responses must be sent by email no later than 10 October.
The same deadline applies to a condoc based on another OTS idea: introducing the concept of marketable security into the tax rules for employment-related securities.
The measure would change the basis of taxation for employment-related securities so that individuals could choose whether a tax charge will arise at the time of acquirement or, if different, when the securities become marketable.
Other features of the proposal include changes to the rules on readily convertible assets and the taxation of dividend and similar income from employment-related securities in certain circumstances.
Views should be emailed.
