Chancellor Gordon Brown and Paymaster General Dawn Primolo have launched a nationwide roadshow to promote the Share Incentive Plan (SIP). This will run until the end of November.
These plans, by allowing employees to buy shares in their company, also provide employers with an opportunity to align their interests more closely with their staff.
The roadshow will provide information, advice and help to thousands of companies up and down the country about setting up SIPs, says the Inland Revenue.
Speaking at the launch, Chancellor Gordon Brown commented that research in the UK and the US has revealed a clear link between employees owning shares in their company and increased productivity.
Brown said that there is no better incentive for employees than for their work to be recognised and for them to be able to share in their business’s success. “Evidence shows that employee commitment is a vital strength of companies.”
Since the scheme’s introduction in July 2000, more than 470 companies have applied to run a plan. Most of these have been small- and medium-sized businesses, with as few as five employees.
A further advantage for employers is that the costs of setting up and running the SIP, together with the market value of the shares used in the plan, can be deducted from the profits that will be subject to corporation tax.
“There are also National Insurance Contributions savings on the salary that employees use to buy partnership shares and on other benefits employees get from the plan,” explains the Inland Revenue.
For further information on the roadshow, phone the helpline on 020-8481 2040.
To find out more about Share Incentive Plans, visit www.inlandrevenue.gov.uk/shareschemes.
With thanks to Lloyds TSB Success4Business.