Treasury reviews small business tax break
Share options tax breaks for small business managers under review by the Treasury
The Treasury is reviewing a tax incentive scheme for small business after the
cost to government revenues rose by more than £100m.
The scheme allows key staff to exercise share options without income tax or
NICs. This allows them to only pay capital gains tax as low as 10% when taper
relief starts – when the share option is issued rather than when it is
For 2005/2006, the scheme cost the Treasury £170m, and is estimated to hit
£250m this year.
‘I don’t think EMI is being abused,’ said Malcolm Hurlston, chairman of the
Employee Share Ownership Centre in the paper. ‘If it was not successful it would
not cost anything.’