HMRC has announced that EU state aid approval for the Enterprise Management Incentive (EMI) Scheme expired on 6 April 2018. The Government has been following the process of applying to the European Commission for fresh approval and the Commission’s final response is still awaited.
EMI share options granted in the period from 7 April 2018 until EU state aid approval is received may therefore not be eligible for the tax advantages currently afforded to option holders, and share options granted in this period as EMI share options may be treated as non-tax advantaged employment-related securities options.
The temporary lapse of approval and short notice given to companies is unsatisfactory, and currently we do not have any guidance on how long this period of uncertainty will continue. Companies may therefore wish to delay the grant of employee share options intended to qualify as EMI share options until fresh EU State Aid approval has been given.
If you would like to discuss please call Andrew Wilson, Rugby on 01788 539000 or Jon Kicks, Leicester on 0116 261 0061.