Share scheme tax savings revealed.

16/05/2011

Employee share schemes will save workers a total of £870 million in tax this year, according to a leading accountancy firm.

UHY Hacker Young said the figure is 17% higher than the £745 million of tax savings last year.

The company's research also revealed that top management are more likely to benefit from company share profits than other workers.

There has been a 10% decline in the number of companies running share schemes for all staff over the previous two years - from 1,530 to 1,370.

However, over the same period, there has been a 25% increase in the number of firms offering share schemes to senior staff, up from 8,200 to 10,050.

UHY Hacker Young partner Roy Maugham said: "Despite the decline in the number of employers offering shares, rising share values and an increasing tax burden are combining to make shares much more attractive to employees.

"With national insurance contributions having risen by 1% in April, and the threshold for the higher rate of income tax frozen, the potential tax saving from investing in company shares, and the cost to the Treasury, is increasing."

Copyright Press Association 2011