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EMI share option schemes set up, valued with HMRC and kept up to date every year.

Enterprise Management Incentive (EMI) options let a startup give staff a share of the company in place of salary it cannot afford yet. A missed deadline can turn those options into a tax bill for your staff. The scheme’s limits rose sharply on 6 April 2026.

Talk to us about EMIRead the EMI guide
We set up Enterprise Management Incentive schemes for UK startups: checking the company and employees qualify, agreeing the share valuation with HMRC, drafting and granting the options, notifying HMRC inside the deadline, and filing the annual return every year afterwards.

EMI exists because early-stage companies cannot pay what good people are worth, and it is the most generous share scheme in the UK tax system. When it is set up correctly, an employee pays no income tax on the grant, nothing on exercise if the price was set at market value, and capital gains tax when they eventually sell.

When it is not, the same options become unapproved, with income tax and possibly National Insurance on exercise, on a gain the employee cannot yet turn into cash. The usual cause is a valuation that was not agreed or a notification that went in late.

On 6 April 2026 the gross assets limit went from £30 million to £120 million, the employee cap from 250 to 500, and the exercise window from 10 years to 15 (HMRC EMI guidance). Companies that had grown out of EMI, or were about to, should look again.

EMI qualifying conditions from April 2026

Source: HMRC EMI guidance.
ConditionBefore 6 April 2026Now
Company gross assets£30 million£120 million
Employeesfewer than 250fewer than 500
Maximum exercise period10 years15 years
Options per employee£250,000 over 3 years£250,000, unchanged
Working time25 hours a week or 75% of working timeunchanged
The three dates

Three dates decide whether a scheme works. An HMRC-agreed valuation lasts 90 days. Each grant must be notified by 6 July following the tax year of grant. The annual return is due every 6 July after that, including a nil return in a quiet year. If the notification is missed, the options are no longer EMI options, and the employee pays income tax on exercise instead of capital gains tax on sale, on a gain they cannot yet turn into cash.

How we set up an EMI scheme

  1. 1
    Check the company and the people qualify

    We check the company's trade, assets, independence and headcount, and the hours and existing shareholdings of each person you want to include. A problem found now costs less to deal with than one found after options have been promised in an offer letter.

  2. 2
    Agree the valuation with HMRC

    We prepare and submit the valuation and deal with the queries. An agreed value is what protects your employees’ tax treatment. It lasts 90 days, so we time it to match the grants (HMRC share scheme valuations).

  3. 3
    Draft the scheme and the option agreements

    We agree the vesting, what happens when someone leaves, whether options can be exercised at any time or only on an exit, and the exercise window, which can now be up to 15 years. These are commercial decisions with tax consequences, so we make them with you.

  4. 4
    Notify HMRC inside the deadline

    Notification is due by 6 July following the end of the tax year of grant. If it is missed, the options are no longer EMI options.

  5. 5
    File the annual return, every year

    The return is due by 6 July each year, including a nil return in a quiet year. We keep the scheme registered and the returns filed so that it does not build up penalties.

EMI scheme prices

Us

Everything in one price

  • £2,950 + VAT to set the scheme up
  • The HMRC-agreed valuation included in the set-up fee
  • £295 + VAT for the annual return
  • Quoted in writing before we start

Commonly charged elsewhere

Published prices from other UK providers, September 2026

  • £2,000 to £6,500 + VAT to set the scheme up
  • £1,200 to £3,950 + VAT for the valuation, charged separately
  • £155 to £500 + VAT for the annual return
  • A lower set-up fee can cost more in total once the valuation is added

Before you grant options

  • Options granted before the April 2026 changes can often have the 15-year window applied retrospectively, so check this if your earliest grants are nearing ten years old
  • A Northern Ireland company whose trade involves goods or electricity is a “specified company”. It keeps the old limits (£30 million of gross assets, fewer than 250 employees, £3 million of options) and the 10-year window, and cannot use the retrospective extension
  • EMI shares are treated differently from ordinary holdings when it comes to Business Asset Disposal Relief on an eventual sale, so plan for it when the options are granted, because it cannot be fixed at exit
  • A raise changes your share value, so the valuation and the timing of grants need planning around a funding round
Talk to us about EMIHow share structures work

EMI questions

What changed for EMI on 6 April 2026?

The gross assets limit rose from £30 million to £120 million, the employee limit from 250 to 500, and the maximum exercise period from 10 years to 15. The individual limit stayed at £250,000 of options per employee over any three-year period.

Can we extend our existing options to 15 years?

Often yes. The longer window can apply to live, unexercised options, provided the option is exercised on or after 6 April 2026 and, for fixed-date options, the written amendment is made in time. If your early grants are approaching their tenth anniversary, look at this before they lapse.

How much does an EMI scheme cost?

Setting up a scheme costs £2,950 + VAT, which includes the share valuation agreed with HMRC. After that, the annual return is £295 + VAT a year. We confirm the price in writing before we start.

Do we need HMRC to agree the share valuation?

It is not a legal requirement, but we recommend it. An agreed valuation gives you certainty that the exercise price was right, which is what protects the tax treatment for your employees. Agreed valuations are only valid for 90 days, so the valuation has to be timed to match the grants.

What is the deadline for telling HMRC about a grant?

For options granted from 6 April 2024, notification is due by 6 July following the end of the tax year in which they were granted. If it is missed, the options do not qualify as EMI options. They become unapproved options, with income tax and potentially National Insurance on exercise instead of capital gains treatment on sale.

Does an employee have to work full time?

They must work at least 25 hours a week for the company, or if less, at least 75% of their total working time. The second test means some people who work part time can qualify.

Are Northern Ireland companies treated differently?

Some are. A “specified company” — one with its registered office in Northern Ireland whose trade involves goods, or the generation, transmission, distribution, supply, wholesale trade or cross-border exchange of electricity — keeps the old limits: £30 million of gross assets, fewer than 250 employees, £3 million of options across the company and a 10-year exercise window. It cannot use the retrospective extension either. If that is you, plan against the old numbers.

What do we have to do every year?

Register the scheme and file an annual employment-related securities return by 6 July, including a nil return in a year where nothing happened. A missed return leads to penalties, even for a scheme that had no activity at all.

Set up an EMI scheme for your team.

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