Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of reducing the Share Incentive Plan (SIP) holding period from five to three years.
Share Incentive Plans (SIPs) are tax-advantaged employee share schemes, intended to encourage businesses to share financial rewards with their staff, to help to motivate their workforce, support productivity and recruit and retain staff.
SIPs provide generous tax reliefs on shares, including exemption from IT and NICs, and CGT benefits if shares are kept in the plan until sold. To receive the full tax relief, shares must be held for at least five years. The Government believes this is an appropriate length of time to support the policy’s aims to assist staff retention and improved productivity, as well as helping to align company and employee interests.
The Government keeps all taxes and reliefs under review.