The state of play with SAYE for 2026.

Startups in England and Wales must carefully manage Enterprise Management Incentive (EMI) schemes to preserve valuable tax relief, as common mistakes around share classes, compliance, and leaver provisions can permanently undermine benefits. Founders often misuse ordinary shares, misunderstand vesting versus exercise, and fail to maintain alignment with company articles or investor agreements, creating legal and financial risks. With EMI thresholds changing in April 2026, startups should review their schemes, ensure proper reporting, and adopt clear processes to protect employees’ equity and maximize long-term benefits.

Around 5,700 Jet2 employees are set to share a £58 million payout as the airline’s first sharesave scheme, launched in August 2022, matures, with returns boosted by an 84% rise in share price. Employees who participated can either hold or sell their shares, with typical investors seeing gains of several thousand pounds depending on their monthly contributions. Following this success, Jet2 has introduced three more sharesave schemes for over 8,900 employees, alongside ongoing salary increases, profit-sharing, and bonus schemes to reward staff for their customer-focused performance.

Over 50 major UK companies, including Vodafone, Diageo, and Wickes, have urged Chancellor Rachel Reeves to make it easier for employees to buy shares in their employers by reducing the mandatory five-year holding period on Share Incentive Plans (SIPs) to two years. They argue that shorter holding periods would increase participation, giving workers a stake in their company while also helping firms attract and retain talent. The move aligns with the Government’s broader goal of encouraging ordinary people to invest and creating a more financially engaged workforce in the UK.

The Budget made contrasting changes for employee ownership, reducing the capital gains tax relief for shareholders selling to Employee Ownership Trusts (EOTs) from 100% to 50%, which could disadvantage those mid-sale and dampen enthusiasm for EOTs. Conversely, reforms to Enterprise Management Incentive (EMI) share option schemes were welcomed, with expanded eligibility, higher thresholds, longer option terms, and reduced administrative burdens, making EMI schemes more attractive for companies and employees. The inconsistency—cutting incentives for full employee ownership while enhancing tax advantages for EMI share options—has drawn criticism for sending mixed signals about the government’s support for employee ownership.

Almost 1,000 Wickes employees will share a £14.1 million windfall from the company’s employee share save scheme, benefiting as the stock more than doubled in value over three years. Staff invested between £10 and £500 a month at a discounted price, with average savers more than doubling their investment and maximum savers potentially making over £22,000 in profit. The scheme rewards employees for their commitment, with many planning to use the payout for home improvements, holidays, and long-term investment.

From 1 January 2026, Guernsey will tax share-based benefits at vesting or exercise rather than at grant, allowing a deferral of up to seven years and aligning taxation with when employees actually receive economic value. The taxable amount is still calculated based on the grant-date value, providing certainty for employees and employers, but accelerated taxation applies in cases of death, retirement, termination, or departure from Guernsey. This change makes Guernsey more competitive for attracting talent and innovative companies, particularly in tech and startups, and organizations should review existing share schemes in light of the updated Statement of Practice E43.