Reshma Johar provides a helpful checklist for company owners when considering enterprise management incentives for employees.
Of the four types of approved share schemes, the enterprise management incentives (EMI) scheme offers both flexibility and discretion in its use. It was originally introduced to incentivise and retain key employees (but excluding contractors).
Both option holders and the employing company benefit from various tax advantages.
How flexible is ‘flexible’?
A company can decide who the options are awarded to, what the option price will be, what the terms or targets should be (if any), and when the options can be exercised.