10 July '24

4 minute read

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As businesses battle to attract & retain key people and the best talent, an employee share scheme can be a powerful and popular way of doing so.

An employee share scheme offers members of your team a stake in your business. They offer competitive remuneration packages without sizeable upfront costs. And, by linking your employees’ remuneration directly to your business’ growth, share schemes are a fantastic way to boost buy-in, loyalty, motivation and performance in your team.

It’s no wonder share schemes are so popular. After all, if you don’t incentivise your team, another business will. But, it’s crucial your schemes are compliant and tailored to your employees’ specific needs for the best results.

Below, we’ve explored how Cooper Parry can help you establish a new employee share scheme, and what you should do if your existing share scheme isn’t having the desired impact.


We can work with you to design and implement one or more of a range of employee incentive schemes, including:

  • Enterprise Management Incentives (EMIs)
  • Company Share Option Plan (CSOP)
  • Share Incentive Plan (SIP)
  • Long Term Incentive Plans (LTIPs)
  • Growth Shares

These are cost-effective, tax-efficient ways of incentivising employees and keeping them aligned with the business’ goals. Most of them offer a pay-out to employees in the event of a business sale, too, and this pay-out is often subject to the lower capital gains tax rates (10% or 20%), as opposed to the higher rates of national insurance for both employees and employer.

We’ve seen some great success stories with our clients who have used these schemes. For example, one in the Healthcare sector who saw the value of their business grow rapidly over a couple of years once their key employees knew they could share a ‘slice of the pie’ along with the other shareholders.

So, which scheme would work best for your business and employees? That question calls for a chat, and if you’d like to explore and discuss all your options, let us know today.


Perhaps you’ve already implemented an employee incentive scheme that’s still live. Is the scheme having the desired impact on your employees’ behaviours? Are you concerned it might not be compliant for tax or legal purposes?

All too often, we’ve seen businesses get close to a sale, only to find that their incentive scheme either won’t pay out at all or will be taxed at the higher income tax rates, instead of capital gains tax rates.

That’s why we can help you with a share scheme ‘health check’, examining the scheme and flagging any errors or risk areas. If we do find any issues with your share scheme, we’ll help you set them straight, and if there are no issues, you’ll have peace of mind and a review to share with your due diligence advisers.

One share scheme health check we completed looked at a client’s long-standing EMI scheme, implemented by another adviser. After going through a restructuring transaction, they thought the old options had been replaced like for like. But, the valuation work had been done incorrectly and the replacement options wouldn’t qualify for EMI tax advantages, causing a potential tax exposure of c.£220k.

So, if you’ve already got an employee share scheme in place and you’d like us to review it and find out if it’s compliant and aligned with your people and goals, get in touch.