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Employee share option schemes

Reward your team with equity

Keep talent onboard and engaged for your startup’s journey.
On SeedLegals, it’s easy to create and manage an employee share option scheme tailored to your business.

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Launch a share option scheme

The secret weapon to incentivise your team

Take a quick tour of SeedLegals option schemes. Our CEO Anthony Rose explains how to use share options as an incentive, how to set up your scheme and why you want a low company valuation from HMRC. Bonus: see how your option holders can log in to view their options and calculate how much they might be worth.

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Simple employee equity compensation

The easiest way to set up an option scheme

Create your option scheme on SeedLegals in just a few clicks, with support from your dedicated options expert.

  • EMI Valuation

    Our EMI Valuation tool helps you secure a low price for EMI options for your team.

  • EMI Share Option Scheme

    The most tax efficient way to give equity to your employees.

  • Unapproved Option Scheme

    The best way to give equity to contractors and consultants.

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Design your employee share scheme

Fast-track your scheme

Employee share schemes used to be a headache. Now they’re fast and foolproof. Just build your scheme using our tried-and-tested templated terms. We’ll check the details, create the rest of the docs and guide you through every step.

  • tickGet the best-possible EMI valuation approved
  • tickChoose rules for option allocation, vesting and exercise
  • tickReview your scheme with a specialist
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Full oversight for you and your team

Put your option plan on autopilot

And relax. After you’ve set up your scheme on SeedLegals, it practically runs itself. Plus, your team has their own dashboard to track and manage their options.

  • tickView total options issued and exercised, at a glance
  • tickAdd new joiners anytime and issue option grants instantly
  • tickGet notifications for important deadlines, like the EMI annual return
  • tickYour team can view their options and check what they’re worth using the options calculator
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Expert support with your share scheme

Chat online anytime with our experts

Need some help? Not sure if you’re EMI eligible or what strike price to set? You’ll find plenty of built-in tutorials and step-by-step guidance. And when you need extra support, our expert team is just a click or a call away.

  • tickTalk to us via chat, phone, email or video call
  • tickEnd-to-end help included - no extra cost
  • tickAsk us anything - we're here 9am to 6pm Monday to Friday
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How to set up a share option scheme

  • Log in or register

    It takes less than 3 minutes to create your SeedLegals account

  • Create option pool

    Set aside a slice of equity to share with your team

  • Set scheme rules

    Choose how your team’s options will vest and when they can be exercised

  • Get an expert review

    We’ll go through everything in your scheme, so you can be confident it’s right for you and your team

  • Pass board resolution

    It’s quick to get everything signed and sealed on SeedLegals

  • Agree valuation with HMRC

    For EMI schemes only: submit a share valuation for prior approval

  • Grant options

    Add your team members and their allocation. Send out grants in just one click

  • Ask if you need help

    If you get stuck at any point, hit chat to message an expert

FAQs

Frequently asked questions about share option schemes


  • What is an employee share option scheme?

    Employee share option schemes are a way to incentivise and reward your team for their hard work.

    When you create a share option scheme or plan, you create the rules and conditions under which your team members can earn options.

    Options give your team the right to buy shares in your company in the future at a pre-agreed price (the ‘strike’ price).

    There are many reasons why companies choose to reward their team with equity via shares options and not shares. You can find full details in shares vs options: what’s the difference?

  • Why do companies give employees equity?

    When employees hold equity in the company they work for, their interests are directly tied to the company’s. When the company does well and its share price increases, so do the value of the employee’s shares. It gives the employee a personal stake in the company - and a reason to stay as the company grows.

    Equity compensation is a way to motivate employees, retain and nurture talent and reward top performers.
  • How do I set up an employee share option scheme?

    On SeedLegals it’s easy - and we’ll help you at every step.
    First, decide whether you need an EMI scheme or an Unapproved scheme (see below).

    The exact steps will depend on the scheme you choose.

    In general, to set up a scheme on SeedLegals, you need to:
    - Create your option pool
    - Create your option scheme
    - Choose vesting and exercise rules
    - Pass a board resolution to adopt the option scheme
    - Grant the options
    - Enter your team members’ details and details of the option grant
    - Send out the option agreements to your team for signatures

    For more information, see how to set up an Unapproved scheme on SeedLegals or how to set up an EMI scheme on SeedLegals.

    To get started, log in or register and go to Share Options.

    There’s built-in guidance but if you need any help, hit the chat button to message our experts.

  • What are the different types of employee share option schemes?

    On SeedLegals you can create two types of employee share option scheme: EMI and Unapproved.

    The EMI scheme is more tax-efficient for both your company and your team members, but you can only offer EMI options to your full-time, UK-based employees. Because it’s ‘approved’ by HMRC, there are various criteria the company and the employee must meet to be eligible. You can see those criteria in detail in our EMI share options explained article.

    It requires more effort and admin to set up an EMI scheme, because you have to submit a company valuation to HMRC before you grant any options. This sets the strike price your team members pay to exercise their options. On SeedLegals, you can buy access to our EMI Valuation report tool as an optional extra, which helps get you the best possible price.

    You also need to notify HMRC after you’ve granted options as well as sending an annual report. If you create your EMI scheme with SeedLegals, we’ll help you at every stage of this process.

    The Unapproved scheme is so-called because it doesn’t require HMRC approval. This makes the Unapproved scheme less tax efficient - but much more flexible. Through an Unapproved scheme, you can grant options to a greater number of team members, including consultants, advisors, contractors and your international staff.

    Many companies have both an EMI and an Unapproved option scheme to cover different categories of team members.

    For more detail about these two types of option schemes, see this EMI or Unapproved article.
  • What are the tax implications of setting up an employee option scheme?

    EMI share option scheme
    For your team
    • No tax liability on grant
    • Usually no tax liability on exercise
    • When the employee sells their shares, they can usually use Business Asset Disposal Relief sooner and pay a lower rate of Capital Gains Tax

    For your company
    • No NIC due when the options are exercised
    • Possibility of a Corporation Tax deduction when the options are exercised


    Unapproved share option scheme
    For your team
    • No tax liability on grant
    • Income Tax on exercise
    • Capital Gains Tax on sale

    For your company
    • No NIC due when the options are exercised
    • Possibility of a Corporation Tax deduction when the options are exercised


    Tax, as ever, is a complicated area. For more detail, see our article on option scheme tax implications. Please note that we aren’t authorised to provide personalised tax advice, so we suggest you consult an accountant for specific queries.
  • What is the options calculator and how does it work?

    The SeedLegals Options Dashboard makes it easy for your team to understand the value of their options.

    When you share the Option Agreement with a team member, they will get an invitation and a link to create their own SeedLegals account.

    On the dashboard, they will see the vesting status of their allocation, their Option Agreement, Option Certificate and Share Certificate (after they have exercised their options).

    As well as this, they will have access to the Options Calculator. This helps answer two common questions: the potential value of their options based on a given valuation, and how much it would cost to exercise a given number of their vested options.

    For more information about this helpful tool, see our article on the Options Dashboard and Calculator.

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