EMI Share Options Tax Calculator 2026
Calculate tax on EMI share options. No income tax on grant or exercise if qualifying. CGT only on disposal — Business Asset Disposal Relief at 10% if held 2+ years. Up to £250,000 per employee.
Enterprise Management Incentive (EMI) Options Tax Calculator
EMI options are the most tax-efficient employee share scheme in the UK. If structured correctly, you pay no income tax at grant or exercise — only CGT at disposal.
Frequently Asked Questions
What is an EMI scheme?
Enterprise Management Incentives (EMI) is HMRC-approved employee share option scheme for small companies (assets under £30m, fewer than 250 employees). Employees can receive options over shares worth up to £250,000, with significant tax advantages.
What is the tax treatment of EMI options?
Grant: no tax. Exercise: no income tax or NI if options were granted at Market Value. Disposal: CGT only on the gain (sale price minus exercise price). If held 2+ years from grant date: 10% Business Asset Disposal Relief (BADR).
What is the EMI limit per employee?
£250,000 market value of shares per employee (at the time of grant). Company-wide limit: £3 million in unexercised options at any time.
What companies can use EMI?
UK trading companies with gross assets under £30m and fewer than 250 full-time equivalent employees. Certain sectors are excluded (banking, property development, farming, legal/accountancy services). The company must carry on a qualifying trade.
What is BADR for EMI shares?
Business Asset Disposal Relief (formerly Entrepreneurs' Relief) at 10% applies to EMI share gains if: shares are held for 2+ years from grant date, and you are an employee or director. Lifetime BADR limit: £1m of gains. Budget 2024 increased BADR to 14% from April 2025 then 18% from April 2026 — check current rates.
What if the EMI options are not qualifying?
If EMI conditions are not met (e.g., company grows beyond limits), options may lose EMI status. At exercise, income tax + NI becomes due on the difference between exercise price and market value at exercise. CGT still applies on any subsequent gain.
Do EMI options trigger the MPAA?
No — exercising EMI options has no effect on pension contributions. Only flexible pension access triggers the Money Purchase Annual Allowance (MPAA).
How do I notify HMRC about EMI options?
You must notify HMRC of each EMI grant within 92 days. Notify using HMRC's Employment Related Securities (ERS) online service. Annual returns are also required. Late notifications result in loss of EMI tax status.