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Insight

EMI Share Scheme Limits Increased

Mark Gearing
30/05/2012
Confirmation of increase in EMI individual limitFollowing this year's Budget announcement that the individual limit for Enterprise Management Incentive (EMI) options will increase from £120,000 to Confirmation of increase in EMI individual limit

Following this year's Budget announcement that the individual limit for Enterprise Management Incentive (EMI) options will increase from £120,000 to £250,000, the Treasury has recently announced that this limit will increase with effect from 16 June 2012.

The change will particularly be relevant to any business that has employees who already hold EMI options up to the maximum current limit. From 16 June, they may be able to grant further EMI options over an additional £130,000 worth of shares to each such employee depending on whether they have hit the overall company wide limit for EMI options of £3 million. Although the individual limit is about to increase, the overall limit will remain the same.

And a quick reminder that the 2012 Budget also announced that entrepreneurs' relief would be extended to shares acquired on the exercise of EMI options, by removing the requirement that an individual must hold at least 5% of a company's ordinary share capital in order to qualify for the relief. This change has not yet been implemented, but we expect it to be included in Finance Bill 2013, which is normally enacted in July each year.

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