Tax and Employee Share Schemes
6. Employee shareholder shares
To be an employee shareholder, you must own shares in your employer’s company that were worth at least £2,000 when you got them.
You won’t usually pay Income Tax or National Insurance on the first £2,000 worth of employee shareholder shares you get before 1 December 2016.
You won’t get tax relief if you or someone you’re connected with (like a business partner, spouse or family member) have 25% or more voting rights in the company.
When you become an employee shareholder your employer must pay for an independent expert to give advice about the terms and effects of the employee shareholder agreement. This advice doesn’t count as a taxable benefit.
Selling your shares
You might not pay Capital Gains Tax when you sell shares. It depends on when you signed your employee shareholder agreement.
Before 17 March 2016
You only pay Capital Gains Tax on shares that were worth over £50,000 when you got them.
From 17 March 2016
You only pay Capital Gains Tax on gains over £100,000 that you make during your lifetime. The ‘gain’ is the profit you make when you sell shares that have increased in value.