Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Deferred share bonus plan definition

What does Deferred share bonus plan mean? A deferred share bonus plan is an employee share incentive under which some or all of a cash bonus is delivered in company shares, with delivery deferred for a set period. During the deferral, the award normally vests only if the employee remains in service; unvested awards may lapse on leaving. This is a descriptive market term, not defined in legislation or case law. Plans operate within company law, tax, listing and regulatory frameworks. Key features typically include: awards structured as conditional shares, restricted stock units or nil‑cost options; a deferral of one to several years; vesting conditions...

Deferred Share Bonus Plans under UK Law: structuring as employees’ share schemes, governance and shareholder approval, dilution limits, performance and leaver terms, financial services deferral, tax treatment, and dividends

Published by a LexisNexis Share Incentives expert

Practice notes

Deferred share bonus: key elements

Deferred share bonus arrangements are usually made up of the following core features:

they are set up as employees’ share schemes within section 1166 of the Companies Act 2006 (CA 2006)—see Practice Note: The Companies Act definition of employees' share scheme and its implications
participants are generally also enrolled in the company’s annual bonus plan...

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Jeremy Glover (Share Schemes)

Jeremy is a senior incentives lawyer who has over 18 years' experience advising businesses on their employee and executive incentives and share plans. Jeremy's practice focuses on the field of remuneration, executive pay, employee share plans and management buyouts. Jeremy advises a broad range of clients including multinationals, quoted companies, privately owned companies (family, owner-managed businesses, venture capital backed and private equity backed). He also provides specialist expert advice to other professional advisers such as accountants, tax advisers and remuneration consultants for their clients. Jeremy has worked in private practice and in-house and enjoys advising clients using the benefit of both perspectives. Jeremy used to head up the incentives practices at Reed Smith LLP, Stephenson Harwood LLP and the Entrepreneurial Group at EY in London. Jeremy is now a senior consultant to a number of law and accounting firms including Reed Smith LLP, PWT Advice LLP and...

Web page updated on 21/05/2026

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