In his Autumn Statement, the Chancellor George Osborne confirmed that the government is legislating to introduce a new employee-shareholder status, with a number of amendments to the original proposals under consideration.
In addition to the exemption on gains on up to £50,000 worth of shares, the government is considering reducing the income tax and national insurance that arise when employee-shareholders receive their shares.
Potentially, the first £2,000 worth of shares would be free from income tax and national insurance contributions.
Other proposed changes to the draft legislation – which would see employee-shareholders receive these shares in exchange for some of their employment rights – include the removal of the upper £50,000 limit and giving the Secretary of State the power to increase the minimum amount, currently set at £2,000.
The government is also considering enabling companies which are not registered in the UK to utilise the employee-shareholder status and for both the employer and its parent company to be able to issue shares.
The employment specialists at Palmers Solicitors can advise on the most appropriate employment status for each company’s individual circumstances and assist with the relevant paperwork.