There's quite a lot of documentation that you'll need to give employees options.
For EMI options, you should get an EMI Valuation with HMRC first, which requires emailing them an application with a few documents attached (all created by our platform!) You should then set up your EMI Scheme (if you haven't done so already), which requires creating the scheme rules, making the grants for your employees and not to mention tracking them. For unapproved options, you will need to set up your Unapproved Scheme, along with the options agreements.
Fortunately, you can now manage all your share option plans effortlessly for one upfront cost per year, you can create unlimited EMI option schemes and Unapproved option schemes and get unlimited HMRC EMI valuations as part of our Share Options Subscription for £2,490 (+VAT) per year. If you'd like to discuss what suits your business needs, please get in touch with your Account Manager or book in a demo here to see how SeedLegals can help with you reward your team with EMI options.
Here’s what’s included for £2,490 per year:
- Unlimited EMI grants for your UK employees
- Unlimited Unapproved grants for any employee or consultant or adviser
- Unlimited EMI valuations to lock in the best discounts
- Unlimited help from options experts to design and manage schemes
- Options dashboard for each team member to view their allocation
- Everything in Standard membership - cap table, board documents, policies, team contracts and much more
The EMI Valuation
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HMRC filings for your company valuation: The platform will automatically create for you a completed application for EMI Valuation (VAL231) form and cover letter for the Valuation which you can send off alongside your application to HMRC - easy!
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Valuation Report: If you want to get a lower valuation that your last funding round, or if you've never done a funding round before, you'll need a valuation report to send off to HMRC. Our platform can produce you an expert report in a fraction of the time and cost of an accountant, to help you achieve the optimum valuation.
The EMI Option Scheme
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Option Scheme Rules: An EMI scheme needs rules - outlining among other things - what the vesting provisions are, what happens during an exit of the company and how employees are treated when they leave. With SeedLegals, you get a fresh set of rules, designed exactly to what you need, not a template.
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Grant Paperwork: Once you've got the valuation approved by HMRC, you can then start sending out option agreements to your employees. Our platform makes this a breeze. In a few clicks you can specify who you are granting options to, how many options are granted as well as the conditions attached. We'll create for you the grant paperwork for the company and employee - no more copying and pasting. You can even sign the grants online. We'll even provide you a Joint NIC Election form if you want to completely safeguard your company from any unwanted NIC tax liability.
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Option tracking: As your team grows, it gets harder to figure out exactly who has what, what's vested and what's left to vest. But once you've granted options, you'll have access to our beautiful dashboard, which can show you exactly how many options are outstanding, vested and exercisable - no more Excel.
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Exercise of options: To cap it off, once an option is exercisable, and the holder chooses to exercise it, the platform can create a notice of exercise (effectively the holder saying they are converting their options into shares now), a Deed of Adherence, a S431 Election and even the SH01 for the company to file with Companies House.
- Termination of options: Sometimes options need to be terminated, it happens. If this is the case for you, we’ll provide a Deed of Termination.
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EMI Notifications: HMRC requires that you let them know about the grant of EMI options - a so-called "notification". This has to be done by the 6th of July following the end of the tax year in which the option is granted. On SeedLegals, you can instantly export an excel file detailing your grants and upload it to your HMRC account. To note, the notifications are done on the HMRC Portal (and not on platform) and are ultimately your responsibility to complete. You can check out our handy guide on EMI Notifications here. Please also remember to take a screenshot of each EMI Notification you make for safekeeping.
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EMI Annual Returns: On top of the notifications above, every company with an EMI scheme needs to do an annual return every June (due July 6). We provide you with a reminder* that this deadline is approaching but the return is completed on HMRC's portal and is your responsibility. If you need support with the return, please speak to your accountant about the filing itself or refer to our step-by-step guide on this here.
The Unapproved Option Scheme
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Option Scheme Rules: An Unapproved scheme needs rules - outlining among other things - what the vesting provisions are, what happens during an exit of the company and how option holders are treated when they leave. With SeedLegals, you get a fresh set of rules, designed exactly to what you need, not a template.
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Grant Paperwork: Once the scheme rules are adopted you can then start sending out option agreements to your option holders. Our platform makes this a breeze. In a few clicks you can specify who you are granting options to, how many options are granted as well as the conditions attached. We'll create for you the grant paperwork for the company and option holders - no more copying and pasting. You can even sign and witness the grants online. We'll even provide you a Joint NIC Election form if you want to completely safeguard your company from any unwanted NIC tax liability.
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Option tracking: As your team grows, it gets harder to figure out exactly who has what, what's vested and what's left to vest. But once you've granted options, you'll have access to our beautiful dashboard, which can show you exactly how many options are outstanding, vested and exercisable - no more Excel.
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Exercise of options: To cap it off, once an option is exercisable, and the holder chooses to exercise it, the platform can create a notice of exercise (effectively the holder saying they are converting their options into shares now), a Deed of Adherence, a S431 Election and even the SH01 for the company to file with Companies House.
- Termination of options: Sometimes options need to be terminated, it happens. If this is the case for you, we’ll provide a Deed of Termination.
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ERS Annual Returns: On top of the notifications above, every company with a registered unapproved scheme needs to do an annual return every June (due July 6). We provide you with a reminder* that this deadline is approaching but the return is completed on HMRC's portal and is your responsibility. If you need support with the return, please speak to your accountant about the filing itself or refer to our step-by-step guide on this here.
If you want to discuss any of these in further detail, please speak to your Account Manager or book in a demo. Alternatively, you can also get in touch using the chat box at the bottom right of the page.
*We cannot ensure that the reminder will reach you. This will depend on numerous factors and settings (e.g. who is the assigned contact for the reminders, whether marketing emails are enabled etc).