For SAYE invitations issued on or after 18 August, new SAYE bonus rates and an early leaver rate will apply.
The changes come into effect following the launch of the new Save As You Earn (SAYE) bonus rates automatic mechanism and SAYE prospectus. The new bonus rates apply to participants who join within three months of the date the rates are set. It won’t affect participants in existing SAYE contracts.
The current rates are with effect today, 18 August:
- three-year bonus rate: 1.1
- five-year bonus rate: 3.2
- early leaver rate: 1.42%
The rates will change on the 15th day following a change in the Bank of England Bank Rate. The Monetary Policy Committee, who decide the base rate, will next meet on 21 September. Confirmed meeting dates are published on the BoE website.
What does this mean?
If you have a SAYE invitation on the horizon, you may want to think about your headroom, as bonuses result in more shares being granted overall. And if you’ve got an international SAYE in place, it might be wise to consider what approach you want to take.
You also need to think about updating your SAYE communication, as it’s likely it won’t mention bonus rates. It should – this will be the first time many colleagues will have received a bonus since 2014. Although it’s a positive message, it’s still something new for colleagues to wrap their heads around. And it’s a good opportunity to include reference to the change in Capital Gains Tax (CGT) allowance. This has been reduced to £6,000 for the 2023-24 tax year, with a further reduction to £3,000 in the 2024-25 tax year.
That’s where we can help. We’ll review and refresh your communications to ensure they reflect SAYE bonuses and CGT changes. We’ll bring our share plan knowledge and creative communications expertise together to ensure your content is accurate, easy to understand and engaging.
We create communications that have impact where it matters most. Contact us for an informal chat.