Employee Ownership

Employee Ownership

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Employee Ownership

Guidance from a firm going through it

What does Employee Ownership mean for employees? Employees will be able to benefit from the firm’s future success.

As an employee-owned business, you can honour and simultaneously build on your firm’s culture.

By creating owners across the organisation, people feel and act like owners. The better the firm does financially, the better the dividends!

Widening ownership also gives employees autonomy, purpose and influence.

By being able to have a say in the way the firm is run and suggesting new ideas for development, people at all levels can positively contribute, and reap the rewards.

Benefits of an Employee Owned firm An employee owned firm offers exceptionally generous tax breaks for employees.

It allows employees to become a shareholder and to share in the success of the business.

Employers value the ability of an EOS to act as a longer-term incentive, rewarding loyalty and encouraging retention.

Our Employee Ownership Scheme

There are a range of share schemes available, but the one that Slater Heelis is using is a ‘Share Incentive Plan’. This is a government approved share scheme that allows employees to acquire shares in a tax efficient way. Share Incentive Plans (SIP) can only be operated by limited companies; this was one of the motivating factors behind our decision to move from an LLP to a limited company structure last year.

Here is a breakdown of the types of shares available, and eligibility to be involved:

The Scheme

Free Shares Because this is the first year of the scheme, each eligible employee will be offered free shares.

All full-time staff, regardless of length of service, will be allocated the same number of free shares. For part-time staff, these will be calculated pro-rata.

‘Buy One Get One Free’ For staff who wish to invest more into the scheme, there is the option to purchase ‘Partnership Shares’ out of your pre-tax pay, in the same way that other salary sacrifice schemes work.

On a ‘buy one get one free’ style basis, Slater Heelis will match any shares bought, with one Matching Share for every Partnership Share purchased.

Eligibility

To be eligible to take part in the scheme, you must:

Be an employee of Slater Heelis Limited, and Have been in continuous employment with us for 18 months.

How will our colleagues get value from their shares?

The shares will build up value over the next few years. Once the share incentive plan reaches its full allocation, the board at Slater Heelis will divide up the dividends at a specified percentage of the net profits.

The amount they receive will depend on how many shares they hold.

The first £2,000 of dividend income is currently tax-free for UK residents.

To the extent that they have no other dividend income in the tax year, they are likely to pay no income tax on any dividends.

Dividends received on shares held in an ISA or pension do not count towards this £2,000 limit. Explore Employee Ownership for Your Business Our own Corporate team has led the way in our journey toward Employee Ownership. they have created an excellent solution for us as a business, just as they do for their own clients. The team is highly experienced in this realm. If you'd like to speak with one of our corporate team, we will be more than happy to put you in touch to discuss Employee Ownership further.

0161 969 3131 slaterheelis.co.uk

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