max temp: 13°C

min temp: 10°C

ESTD 1874 Search

East Anglia: Share scheme will not help the small firms it is aimed at, says Grant Thornton

06:00 26 December 2012

Amanda Stapleton, senior tax manager at Grant Thornton East Anglia

Amanda Stapleton, senior tax manager at Grant Thornton East Anglia


THE Government’s planned Capital Gains Tax-free employee shareholder scheme may be good news for some but will fail to help the small businesses it is aimed at, financial and business advisers Grant Thornton has warned.


The scheme means that, from April 6, 2013, employees may be offered the option to receive a minimum of £2,000 worth of employer shares in exchange for releasing some of their employment rights such as redundancy and maternity provisions.

But Amanda Stapleton, senior tax manager at Grant Thornton East Anglia, says the scheme is unlikely to be an attractive proposition for the average employee as most people in the current economic climate are not in the position to invest in a company.

She also says the complex and ambiguous scheme could bring a number of challenges for small businesses:

“The scheme seems a little out of touch with reality in that it does not cater for the small businesses it is designed to help,” she said.

“There is also confusion surrounding key areas such as who will buy back the shares when an employee leaves, what constitutes a ‘reasonable’ price, and in what timeframe.

“Therefore, if an employee decides to leave and knows the employer will buy the shares back, it provides little incentive for them to stay which could mean employers are left paying a high price.”

Under the scheme, the Government will exempt gains on up to £50,000 of shares acquired by employee shareholders from capital gains tax from April 6, 2013.

The Government is also considering options to reduce Income Tax and National Insurance Contribution (NIC) liabilities that may arise when employees receive their shares. One option would mean that the first £2,000 of shares received under the new status would be free from income tax and NICs.

Amanda Stapleton added: “Despite best intentions with this scheme, the Government needs to focus on helping the majority of businesses by implementing ideas that are simple to achieve and flexible enough for a range of companies to benefit.

“These could include incentives to accelerate the release of capital and loans to businesses of all sizes which would help confidence to return and mean that businesses are more willing to invest in and hire talent.”



Alistair Ponder, Leanne Castle and Alex Till of Menta receive their trophy from Declan Curry at the National Enterprise Network annual awards.

Bury St Edmunds-based enterprise agency Menta has won an Enterprise Support Organisation of the Year accolade at the National Enterprise Network’s annual awards.

An artist's impression of the new Hampton by Hilton hotel to be built and Stansted Airport,alongside the existing Enterprise House office complex, right.

A new £45million hotel is to be built close to the main terminal at Stansted Airport, bringing the number of hotels on the airport site to five and creating around 60 new jobs.

Frank Brumby, eastern region chairman of R3.

“Zombie” businesses are on the march in the East of England, according to a survey by insolvency trade body R3.

Royal Bank of Scotland has passed the latest Bank of England stress test, but missed fulfilling one of the capital guidance criteria.
Photo: David Cheskin/PA Wire

All seven of the UK’s largest lenders have passed the Bank of England’s latest “stress test”.

Max Chmyshuk, founder and managing partner at Fleximize.

More than £25million-worth of credit applications by small and medium-sized enterprises (SMEs) in eastern England are being rejected by banks every month, according to alternative lender Fleximize, which is based Ipswich.

Most read

Most commented

Topic pages

Local business directory

Our trusted business finder

Property search

e.g. Oxford or NW3
Powered by Zoopla

Digital Edition

Read the East Anglian Daily Times e-edition today E-edition

Great British Life

Great British Life
MyDate24 MyPhotos24