Schemes offering people shares in their employer are set for a shake-up.
The government has launched a call for evidence as it explores potential changes to Save As You Earn (SAYE) and the Share Incentive Plan (SIP), with the aim of making it easier for businesses to set these up and offer them to staff.
Save As You Earn (SAYE) allows employees to buy discounted shares in their company if they save money each month for three to five years.
The Share Incentive Plan (SIP) allows companies to help their employees to purchase shares directly in their company or offer them as awards, tax-free.
The move comes as a HMRC evaluation report shows that 81% of businesses say these schemes help boost their business, with almost three-quarters of these saying it has helped them retain and recruit staff.
However 31% of businesses which are unaware of these schemes say they are too complicated to set up.
The government says it is particularly focused on ensuring more people on lower incomes are able to take advantage of them.
“Employee share schemes are an effective way to boost motivation in workforces by giving people an extra stake in what they do – and they offer a boost for business,” said Victoria Atkins, Financial Secretary to the Treasury.
“Growing the economy is a priority for this government and one way to make this happen is by making these schemes as easy as possible to set up.”
The HMRC evaluation claimed 50% of companies which have set up a share scheme have done so to create a feeling of ownership among their staff, with other common reasons being to help retain staff and skilled employees, attract skilled employees and improve staff morale.