ESP-Software evolved from the need to make the administration of employee share plans simple and to give control of the employee share plans to companies wishing to administer their own plans.
Here, you can learn more about us.
Click here to learn more about The Share Incentive Plans Software (SIPS). And see the demonstration video.
FAQ: Are there any disadvantages?
Buying partnership shares under the plan may affect your entitlement to contribution-based, earnings-related and means-tested state benefits, tax credits and work-related payments.
You will not have paid NICs on the pay that you used to buy the partnership shares. As a result, you may not have paid enough NICs to qualify for certain benefits. This will only affect a small number of people. Our leaflet IR177 - Share Incentive Plans and your entitlement to benefits - explains this in more detail.
Shares can go down in value as well as up. So, if you are thinking of buying partnership shares under the plan, you might want to consider whether you could afford to make a loss if the shares do not perform as well as you hope.
Source: Inland Revenue
A Share Incentive Plan, provided that it is approved by the HM Revenue & Customs,
can provide tax advantages to both the employees and the company directors.
One of the obligations to get your share incentive plan approved is to invite all of your employees.
The Share Incentive Plan legislation provides for three main types of plan shares to be used. They are:
- free shares - employers can give each employee free shares worth up to £3,000
- partnership shares - employees can use up to £1,500 per year out of pre-tax and pre-National Insurance Contributions (NICs) pay to buy partnership shares
- matching shares - employers can give matching shares at a ratio of up to two matching shares for each partnership share bought by the employee
- dividend shares - employees may be allowed to use up to £1,500 of dividends from their plan shares each year to buy further shares in the company through the plan
£9,000 each year - A tax free investment as shares should be very encouraging!
All an employee needs to do is to keep the shares in the plan as long as possible (usually 5 years) to pay less tax and NICs when he finally takes them out.
Please refer to IFS ProShare's briefing on SIPs for more information.
Beat the recession!
Beat the recession and save on outsourcing costs by taking control and managing your SIP in-house with our SIP software.