If your business is using or considering any of the following models, (Save as You Earn, Share Incentive Plan or Employee Ownership Trust) you need to engage with a wide reaching Government consultation which started on 5th June and ends 25th August.  You can find the direct link to the consultation here;

https://www.gov.uk/government/consultations/non-discretionary-tax-advantaged-share-schemes-call-for-evidence

I attended a round table organised by the EOA  (Employee Ownership Association),  the trade body for EOT’s (Employee Ownership Trusts) in the UK yesterday.

What was interesting for me was the range and diversity of views on whether things like should offshore trusts be allowed, should the £3600 p.a tax free bonus for employees be moved up as it has been static since 2014 and the original legislation. Understandably a lot of the professional advisors have vested interest in particular parts of the legislation staying the same or changing, although the degree to which this was obvious surprised me.

By number most converting businesses to EO these days are smaller and if the model is to continue to thrive this should be a key stakeholder constituency for the EOA. However there are some very influential voices from large advisory firms who are not interested in small businesses not because they cant successfully convert and create sustainable futures but because they cant pay tubby fees.  Eventually the largest number of EO employees (ultimately the beneficiaries of trusts) will be in small businesses as they are in the wider economy and this trend of comminution of corporates which has been present for 50 years shows no signs of abating.  In 2022 over 60% of employees in the private sector worked in small businesses (those with less than 250 employees).  If you are needing something to send you to sleep the source is here;

https://researchbriefings.files.parliament.uk/documents/SN06152/SN06152.pdf

There is an analogy with my work in housing as Chair of Worthing Homes that struck me quite hard too. If the goal of the EOA is to spread the benefits of employee ownership to as many as possible then a lot of its stakeholders are not in the conversation as they are in businesses that have not converted yet. In the same way that whilst try as hard as we might to engage with our own residents in housing associations it is even harder for us to engage with our stakeholders we need to home, those who are not residents yet. This is why we all need your help, dear readers, if you are so much as thinking about conversion at some stage in the future do engage in the consultation using the call for evidence link above or by engaging with the EOA on through the link below.

Government launches consultation on share schemes affecting employee owned businesses

Of course if you are running or thinking of SIPP’s or SAYE schemes speak to your professional advisors or use the link direct to the government consultation.