Compensation & Benefits: New Sharesave bonus rates

18 January 2012 |

Employees participating in HMRC approved Sharesave schemes are required to save a certain amount from their net pay, normally monthly.  The arrangement will normally include an entitlement to a bonus which is equal to a guaranteed number of monthly contributions.  After the savings period, employees can use the money to buy shares in the employer or withdraw the total savings and tax free bonus.  The bonus rates are set by the HMRC.

On 29 May 2009 HMRC introduced new Sharesave bonus rates.  These new rates will apply to those joining Sharesave schemes on or after 29 May 2009.  The new rates from 29 May 2009 are set out below and are at an all time historical low reflecting the all time low bank of England base rates.

  • 3 year bonus = 0.3; equivalent interest rate = 0.54%;
  • 5 year bonus = 2.2; equivalent interest rate = 1.42%;
  • 7 year bonus = 5.2; equivalent interest rate = 1.84%;
  • early closure interest = 0.36%.

For further information please get in touch.

Disclaimer

Content is for general information purposes only.  The information provided is
not intended to be comprehensive and it does not constitute or contain
legal or other advice.  If you require assistance in relation to any
issue, please seek specific advice relevant to your particular
circumstances.

Disclaimer

Content is for general information purposes only. The information provided is not intended to be comprehensive and it does not constitute or contain legal or other advice. If you require assistance in relation to any issue please seek specific advice relevant to your particular circumstances. In particular, no responsibility shall be accepted by the authors or by Abbiss Cadres LLP for any losses occasioned by reliance on any content appearing on or accessible from this article. For further legal information click here.

Circular 230 disclosure

To ensure compliance with requirements imposed by the IRS and other taxing authorities, we inform you that any tax advice contained in this article (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties that may be imposed on any taxpayer or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.

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