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ARTICLE
7 November 2024
BUDGET: KEY IMPLICATIONS FOR EMPLOYEE SHARE PLANS
External News

KPMG

Legal and regulatory
All plan types
UK and Channel Islands

The recent Budget introduces changes that will impact the cost and compliance of employee share plans, including an increase in employers' National Insurance Contributions (NIC) from 13.8% to 15% from April 2025, which could make tax-advantaged share plans more appealing. Additionally, increases in capital gains tax (CGT) rates and reductions in CGT exemptions may lead to higher tax obligations for employees, potentially affecting the attractiveness of these plans, while employers may need to enhance support and communication to help employees navigate these changes. For internationally mobile employees, the new tax regime replacing the remittance basis introduces limitations and complexities, requiring employers to reassess their compliance strategies and tax equalization policies.

ARTICLE
8 October 2024
UK - BIG NEWS: IA PRINCIPLES OF REMUNERATION 2025 PUBLISHED!
External News

Tapestry Compliance

Legal and regulatory
All plan types
UK and Channel Islands

The Investment Association (IA) has released its updated Principles of Remuneration, setting expectations for the 2025 AGM season and beyond, emphasizing long-term value creation, strategic alignment, and improved company-investor consultation. Notable changes include the removal of the 5% dilution limit for discretionary share plans, potential exceptions to the 10% dilution limit for high-growth companies, and the exclusion of all-employee plans from the requirement for shareholder re-approval every 10 years. The IA clarifies that these principles serve as guidelines rather than strict rules, offering companies more flexibility while maintaining alignment with shareholder expectations.

ARTICLE
31 October 2024
IA SIGNALS MOVE TO GREATER FLEXIBILITY IN UK EXECUTIVE PAY STRUCTURING
External News

Pinsent Masons

Executive pay
Executive plans
UK and Channel Islands

The Investment Association (IA) has released updated remuneration principles, offering greater flexibility for UK-listed companies to structure executive pay in ways that attract and retain top talent in a competitive global market. Key changes include relaxed dilution limits, with the 5% restriction on discretionary share plans removed, and allowances for evergreen employee share plans that no longer require shareholder approval every 10 years. While these updates provide companies with more discretion, they must still align with existing shareholder-approved remuneration policies and plan rules, ensuring compliance while leveraging the new flexibility to meet strategic objectives.

ARTICLE
11 October 2024
UK BANK MONZO VALUED AT $5.9 BLN IN EMPLOYEE SHARE SALE
External News

Reuters

Trending now
All plan types
UK and Channel Islands

British digital bank Monzo recently saw employees sell shares to investors, including Singapore's sovereign wealth fund, in a transaction valuing the company at £4.5 billion ($5.9 billion). This follows a March funding round that valued Monzo at £4 billion, marking continued investor confidence as the digital bank reports its first full-year profit and plans expansion in Europe and the U.S. This secondary sale aligns with a broader recovery in European fintech valuations, as seen with Revolut's $45 billion valuation in August.

ARTICLE
22 October 2024
POST OFFICE EXPLORING EMPLOYEE-OWNERSHIP MODEL
External News

HR Magazine

Design and strategy
UK and Channel Islands

The UK government is considering converting the Post Office into an employee-owned company through an Employee Ownership Trust (EOT), similar to the John Lewis model, which would give employees a stake in the business and a say in its operations. The move comes as EOTs have become more popular, with calls for ownership reform at the Post Office intensifying due to recent governance issues and the Horizon IT scandal. While EOTs offer benefits like profit-sharing and increased employee influence, union representatives emphasize that governance changes are essential for the model’s success at the Post Office, advocating for a cooperative approach with greater accountability.