New Vehicle for Employee Shares
The Government wants to seek views from businesses, employees and share scheme experts on some of the important issues raised by the proposal for an ‘employee shareholding vehicle’” (HM Revenue & Customs and HM Treasury consultation on the new employee shareholding vehicle).
Introduction
The Government continues to demonstrate its support for employee share ownership in all its forms with the publication on 17 July 2014 of an open consultation seeking views on the introduction of a new employee shareholding vehicle (“the consultation”). The consultation follows hot on the heels of the introduction of new tax reliefs for employee-ownership trusts (“EOTs”) to promote the trust model of employee ownership [see CSR Vol 37, p 73], the call for evidence seeking views on amending the rule against perpetuities for employee trusts and (generally) reducing the complexity of employee ownership [CSR Vol 37, p 153] and company law changes on share buybacks and treasury shares [CSR Vol 37, p 62].
The subject of the consultation is “Recommendation C” of the Office of Tax Simplification’s (“OTS”) final report following its review of unapproved employee share schemes. The OTS recommended the introduction of a “simple vehicle to enable companies… to manage their employee share arrangements and create a market for employees’ shares”. Through the consultation, the Government is keen to receive views on the introduction of such a vehicle, in particular in relation to various detailed tax issues.
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