Posts Tagged ‘jobs’
On April 6th 2014, the UK Government will formally launch a range of tax incentives to help grow the employee ownership sector. There will be an exemption from income tax of £3,600 for certain payments made to employees of qualifying employee-owned companies, and the introduction of a relief from capital gains tax (CGT) for owners selling a controlling interest to a trust which operates for the benefit of all employees. Finally, a tax hook on which to promote employee ownership to those business owners considering their business succession options!!
Although the Centre is disappointed that direct forms of employee ownership, such as the worker co-operative model, have not been recognised, this is still a significant milestone for employee ownership. The tax incentives headline what has been a very busy 18 months of UK policy development in this area, stimulated in the main by the recommendations in the 2012 Nuttall Review of Employee Ownership, ‘Sharing Success ‘
To us at the Wales Co-operative Centre, employee ownership is an economic ‘no brainer’. Giving employees an ownership stake in a business changes their relationship with the business and encourages them to take a positive and proactive role in helping their company grow. Recent research by the Cass Business School supports this by showing that employee owned businesses are more stable and more resilient as a direct result of the employees gaining a real stake in the success of that business.
Here in Wales, we see employee ownership as a crucial succession option which can help keep jobs, business and skills in Wales. Unfortunately it is often the forgotten succession option, not being viewed as a mainstream idea by conventional business advisers. At the Wales Co-operative Centre, we have received support from Welsh Government and European Union Regional Development funding to implement employee ownership in Wales and are actively working with both businesses and advisers to put employee ownership firmly in the mainstream.
To mark the introduction of the new tax regime for employee ownership, the Wales Co-operative Centre is hosting a number of breakfast seminars looking at the benefits of employee ownership and how the new tax incentives can benefit business owners who would like to move on from the business.
The events in Cardiff, Carmarthen and Bodnant in North Wales will also consider the employee trust, how it fits with your business model, and the benefits of the model for the business owner and the employees. The seminars will be of interest to business owners interested in looking at their exit strategies and to business advisors who want to know more about the approach to advise their clients. To find out more click here.
In our view, tax should not be the sole driving factor to considering employee ownership. Many of our clients are driven by legacy, and see employee ownership as an approach that engages employees and puts them in charge of their own futures. It helps retain jobs and provides a platform for continued local business ownership and growth. However, having an additional incentive to help promote the employee ownership exit route is never a bad thing and we’ll be working hard to promote the new relief available to business owners here in Wales.
Let’s just hope those clever tax specialists don’t find some loophole which allows companies to abuse the incentive for purposes other than employee ownership, otherwise we could see it withdrawn from the market as quick as at arrived.
Further information can be found on the Wales Co-operative Centres Website http://www.walescooperative.org
Places can be booked directly by calling the Centre on 0300 111 5050.
Rhian Edwards is manager of the ERDF and Welsh Government Business Succession project at the Wales Co-operative Centre. Her team works with micro-businesses and SME’s across Wales to develop employee ownership approaches and employee ownership based succession planning.
Congratulations to Get Neath Port Talbot Online, the latest strategic initiative from the Welsh Government’s Communities 2.0 programme, which is led by the Wales Co-operative Centre. Get NPT Online was launched by Minister for Communities and Tackling Poverty, Jeff Cuthbert at Briton Ferry library this week.
Designed to tackle poverty by overcoming barriers to work, the initiative has challenging targets for helping people become confident in using computers, and in finding work online.
Through the Communities 2.0 programme, Wales Co-operative Centre staff have brokered a partnership between NPT Homes, Coastal Housing and the local Communities First organisation, to target support at those in greatest need. Front line staff of all the partner organisations will be trained to help their clients take the first steps towards getting online. This will be backed up by focussed training and support from a team of volunteers. People who were previously excluded from job opportunities through lack of skills will set up their own e-mail addresses, develop online CVs and learn how to search job sites. As a result, they will become included as part of the modern world.
The beauty of Get NPT Online is that it is a genuinely local response to the problems of poverty, worklessness and social exclusion. It works with the community, not on it. Get NPT Online is sustainable, because digital inclusion will be embedded in the working practices of the partner organisations.
Across Wales, the Wales Co-operative Centre is delivering programmes in communities that have a tangible economic benefit. Thanks to funding from the Welsh Government and European Regional Development Fund, people in Neath Port Talbot have a head start.