EMI Options and Furlough
HMRC has now confirmed its position on EMI schemes and satisfying the working time arrangements. HMRC will accept that from 19 March 2020, if an employee would otherwise have met the scheme requirements but did not do so for reasons connected to the coronavirus pandemic, the time which they would have spent on the business of the company will count towards their working time.
HMRC have also confirmed that they will disregard the reduction in working time as a disqualifying event under the legislation if it is for reasons connected to the coronavirus pandemic. HMRC will accept the following as reasons for which an employee may have been unable to meet the working time requirements:
· Working reduced hours
· Unpaid leave.
However, in all cases the reason must be attributable to the current coronavirus pandemic and the period must have begun on or after 19 March 2020. Employers and employees must keep evidence to show that there is a link to the coronavirus pandemic.
Changes to the legislation will be made in the current and next Finance Bill to ensure that EMI options granted before and after 19 March 2020 will remain qualifying in the circumstances outlined above.
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