Do I pay tax when I receive startup options?
Usually not at grant for EMI if strike price equals market value. Tax is typically due on gain at sale (EMI) or at exercise (many unapproved schemes).
Startup Equity Tax in the UK
UK startup equity tax depends on scheme type. EMI is most common at venture-backed startups — qualifying gains taxed at 10% (BADR) vs up to 45% income tax for non-qualified options.
Exit scenario
Estimate gross and net proceeds after tax
EMI vs unapproved options
EMI requires company size limits, independent valuation, and HMRC notification. Unapproved options are simpler for companies but far more expensive for employees at exercise and exit. Check your grant agreement scheme type before modelling tax.
Frequently asked questions
What is the EMI tax rate on exit?
10% on qualifying gains under BADR, subject to eligibility. Use our EMI calculator to estimate net proceeds on a specific exit scenario.
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