Should you give you shares to your team?

Author: Russell Smith
September 19, 2015

When a business grows and employees are taken on, the business owner will often get to the stage where they think about securing the loyalty of one or more key employees.

Simply put, this can either be done by giving them shares or giving them bonuses.

There are quite a few strong opinions out there of which is better. There are some very rich business people out there who swear against giving shares (for example see Felix Dennis’ book ‘How to get rich’). On the other hand, there are some decent tax advantages for giving shares to employees (the Enterprise management incentive (EMI) share option scheme).

So here’s some questions to ask yourself?

1. Is your key employee(s) in it for the long haul?

2. Is the key employee truly irreplaceable?

3. Are you prepared to give some of your profits to the key employee?

4. Does the key employee fit into your culture?

5. What does the key employee want from their career? What are their salary/earning aspirations, if any?

If you’d like to talk further about how/whether to give shares away email me at russell@rsaccountancy.co.uk

0113 394 4616

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