Employee-Investing Scheme Expected to Slash Red Tape and Improve Workers’ Shares

When it comes to share dealing, there are at least four (4) major types of company share schemes that can be employed. These are the share incentive plan or the SIP, the save as you earn or SAYE scheme as well as the company share option plan and the last one is the enterprise management incentives. This article will explain these schemes briefly in the following section hereunder.

On the one hand, the share incentive plan is one of the most common schemes in the word of share dealing or even in stock market trading. This scheme was first introduced in the United Kingdom during at the beginning of the 21st century. There are at least four (4) elements of the SIP, which the company can choose one or more of them. These are the free shares, the partnership shares as well as the matching shares and, finally, the dividend shares. Specifically, it involves free shares and free of tax for up to 3000 Euros annually. The major benefit of this is that the employee SIP provides the option and opportunity for them to leverage and invest on the pre-tax salary from the company that they are working for and eventually become a share holder of the same. In terms of the trends of this share dealing scheme in UK, it peaked during the 2006-07 at the level of 960, but eventually fell in 2009-10 at the 860 level.

On the other hand, the save as you earn or SAYE is another scheme in share dealing or ownership. This can be granted to all of the employees in a company. The staff of a company will have to agree to save a specific sum, which will then be used in order to buy shares at its original price. The best part here is that the interest as well as the share dealing options are all free from tax.

Moreover, the third share dealing and ownership scheme is the company share option plan. This scheme of granting free shares is intended for specific employees of a company only. Last, but not the least, the enterprise management incentives is another scheme wherein the key staff members of a company can get share options that is worth as high as 250,000 euro free from taxes.