The Minister for Finance, Michael McGrath TD, has welcomed the commencement of four amendments to the Key Employee Engagement Programme (KEEP) as introduced in Finance Act 2022, following receipt of approval of State aid from the European Commission. KEEP was introduced in 2018 to enable unquoted companies to attract and retain key employees, using share based remuneration.
KEEP is an exemption from income taxes on any gain realised on the exercise of a qualifying share option. Instead, the gain will be subject to Capital Gains Tax (CGT) on a subsequent disposal of the shares. The amendments commenced reflect stakeholder feedback and provide for the following:
-
The extension of the scheme to the end of 2025.
-
Capital gains tax treatment can apply to a company buyback of shares acquired under KEEP.
-
The limit for the total market value of issued but unexercised qualifying share options for qualifying companies and qualifying holding companies is increased from €3 million to €6 million.
-
KEEP now applies to ordinary fully paid-up shares, not just to new ordinary fully paid up shares, so that existing shares a company holds can qualify.
Commenting on the commencement, Minister McGrath stated:
“I am delighted to announce that I have commenced the four outstanding KEEP amendments contained in Finance Act 2022, following receipt of State aid approval from the European Commission.
KEEP is a focused scheme aimed at improving the attractiveness of the Irish SME employment offering. It recognises that the improved competitiveness of Irish SMEs supports the creation and maintenance of employment, which in turn supports economic growth.
These amendments extend and expand the current KEEP scheme, and are based on my Department’s continued engagement with stakeholders to ensure that the scheme is working to support Irish SMEs.”
LOADING...