Following the Autumn Budget on 26 November 2025, the UK Chancellor Rachel Reeves announced that the qualification criteria for enterprise management incentive (EMI) schemes will be significantly widened from April 2026.

From 06 April 2026, the eligibility thresholds are to be expanded as follows:

• the employee headcount limit is set to increase from 250 to 500 employees
• the ‘gross assets’ threshold will increase from £30million to £120million
• the overall limit of the value of shares under option will double from £3million to £6million
• the limit on the exercise period of EMI options will be extended from 10 years to 15 years and it may be possible for existing EMI options that were granted before April 2026 (which have not yet expired or have been exercised) to be amended to also take advantage of this extended period in certain circumstances.

Removal of the EMI Notification Requirement

Notably, the government also announced that the existing requirement to notify HMRC on the grant of any EMI options, is to be completely removed with effect from April 2027.   For clarity, the requirement to register schemes with HMRC and submit yearly “EMI Annual Returns” has not changed.

This means that qualifying companies will no longer need to submit a separate notification to HMRC, and this notification process will be rolled into the EMI annual returns filings. Currently, if HMRC are not notified it is likely to mean that the options will not qualify for EMI and tax benefits ordinarily associated with EMIs. Therefore, the removal reduces the administrative ‘burdens’ that can otherwise arise when dealing with EMI schemes.

It is envisaged that the legislation regarding this removal will be included in the Finance Bill 2026-2027.

Why the Change?

The announcement of these changes to the EMI rules is largely driven by the government’s desire to encourage companies to reward their employees by providing share incentives that will make them feel truly aligned with the growth of their respective companies, which is also likely to help them attract and retain the most valued employees.

What this means for Business Owners

The expanded scope of the eligibility thresholds will open up EMI schemes to more companies, and may mean that you are now able to set up an EMI scheme.  If you are interested in incentivising your employees you may wish to consider if an EMI scheme is right for your business.  We would be delighted to discuss the options available to you and assist with preparing a scheme that matches your business nature and goals.

If you have an existing EMI scheme you may wish to take advantage of the increased exercise period.  This does not apply automatically, and so if this increased exercise period would be beneficial we would be happy to discuss whether it is available to your particular scheme and assist with the necessary formalities.

Contact us

For assistance with your EMI Scheme, please get in touch with our corporate team and we would be happy to help.