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This Practice Note outlines the law concerning criminal recklessness. The subjective test for recklessness Certain statutory and common law offences allow the prosecution to prove mens rea through ‘recklessness’. Put simply, recklessness is where the accused takes an unjustified risk that results in unlawful harm or damage. The House of Lords in R v G reaffirmed the subjective approach to recklessness. Before R v G, two distinct tests were used, depending on the offence charged: Subjective recklessness from R v Cunningham: the prosecution had to establish that the accused personally foresaw the risk. Objective recklessness from R v Caldwell: the prosecution only needed to show that the risk would have been obvious to a reasonable person, without proving the accused themselves foresaw it. In R v G, the House of Lords concluded that the objective test could operate unfairly where a defendant did not foresee the
This Practice Note examines the remedy of rescission, explaining when and in what manner a contract can be unwound (at common law, in equity and under statute) and thereby terminated and brought to an end. It covers the consequences and effects of rescission, the principal grounds for setting aside an agreement (misrepresentation, mistake, undue influence, duress, non‑disclosure, fiduciary misdealing and bribery) and the main obstacles to claiming rescission—affirmation, the intervention of third‑party rights and the impossibility of restitution. For further guidance on rescission in the context of misrepresentation, see Practice Note: Misrepresentation—rescission as a remedy. There are many ways in which a contract may reach its end; see: Terminating contracts—how and when a contract ends—overview for a brief and accessible summary, with links to the related further practical guidance, including Practice Note: Termination and expiry of contracts. For a table
What is a res judicata? A res judicata is a determination by a court or tribunal with jurisdiction over the cause of action and the parties, which finally disposes of the issues decided so they cannot be litigated again by those bound, save on appeal. Final judgments entered by default or by consent fall within this concept, whereas rulings on purely procedural points and any decision lacking finality do not. The doctrine’s aim is to bring litigation to an end and shield parties from being harassed by the same dispute twice. in personam—binds the parties and their privies in rem—binds all persons, privy or otherwise (ie a judgment binding the whole world) A party may rely on res judicata: as an estoppel to defeat an opponent’s claim or defence; and/or as the basis of their own claim or
The offence of causing grievous bodily harm with intent Wounding or causing grievous bodily harm (GBH) with intent can be tried solely in the Crown Court on indictment. Elements of the offence Under the Offences against the Person Act 1861 (OATPA 1861), the prosecution must establish that the defendant unlawfully and maliciously: wounded with the intention of causing GBH, or caused GBH with that intention, or wounded intending to resist or prevent the lawful arrest or detention of any person, or caused GBH intending to resist or prevent the lawful arrest or detention of any person ‘Unlawfully’ and ‘maliciously’ Unlawfully The wounding or causing of GBH must be unlawful. Such conduct may be lawful if used: in self-defence in defence of another in defence of property for the prevention of crime where the victim gave express or implied consent For further information on these defences, see below:
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The enterprise management incentives ( EMI) scheme The enterprise management incentives ( EMI) scheme is a notably adaptable and tax-efficient arrangement tailored for small and medium-sized companies. The EMI framework is highly prescriptive and specifies a range of conditions that must be in place when options are granted, including matters relating to: the company granting the options the employees to whom the options are granted the shares subject to the option the terms of the options themselves This Practice Note concentrates on the requirements an employee must satisfy to be eligible to receive EMI options. Those requirements are set out with reference to the income tax relief contained in sections 527–541 of the Income Tax ( Earnings and Pensions) Act 2003 ( ITEPA 2003). For further detail on the tax reliefs available to qualifying EMI options, see Practice Notes:...
Practice Note While EMI share options can be highly tax‑efficient, they also carry notable traps. Poor drafting or faulty implementation can lead to serious tax consequences for both staff and the business. This Practice Note highlights the most frequent misconceptions and errors when: determining if a company is eligible to grant EMI options setting up an EMI scheme, and running an EMI scheme Specifically, it explains: what counts as an EMI option the fall‑out if an EMI option is drafted or put in place improperly the impact of mishandling an EMI qualifying option in operation recurring misunderstandings and errors when testing company eligibility to grant EMI options recurring misunderstandings and errors when establishing an EMI scheme recurring misunderstandings and errors when operating an EMI scheme, and ways to prevent errors and...
Given the intricate rules that govern business asset disposal relief ( BADR) and the regime that sets the tax treatment of enterprise management incentives ( EMI) options, and the way these frameworks interact, the point at which an EMI option is exercised and the exercised shares are then sold is pivotal in establishing whether the full relief for the EMI option and BADR will be obtainable to a taxpayer. A table below outlines the income tax, National Insurance contributions ( NICs) and Apprenticeship Levy ( AL) position for EMI options at grant and at exercise, and the capital gains tax ( CGT) plus BADR outcome on the disposal of shares acquired through exercising EMI options, varying according to when the option is exercised and when the shares are sold. For the purposes of this table, the following assumptions have been made: the share options were issued after 6...
Enterprise management incentives ( EMI) scheme The enterprise management incentives ( EMI) scheme is a highly adaptable and tax-efficient arrangement aimed at small and medium-sized companies. The EMI framework is prescriptive and requires multiple conditions to be met when options are granted, covering: the company issuing the options the employees to whom the options are granted the shares placed under option the options themselves This Practice Note centres on the requirements that the options must satisfy to qualify as EMI options, assuming all other eligibility criteria are in place. These conditions are explained with reference to the income tax relief set out in sections 527–541 of the Income Tax ( Earnings and Pensions) Act 2003 ( ITEPA 2003). For details of the other conditions, see Practice Notes: EMI—qualifying companies EMI—trading activities EMI—what makes an employee...
Enterprise management incentives ( EMI) and company share option plans ( CSOPs) are discretionary share option arrangements in the UK that offer favourable tax treatment. Although EMIs can deliver more attractive tax outcomes and permit larger personal grants, their qualifying criteria are considerably tighter than CSOPs. Consequently, businesses that cannot meet EMI conditions often implement a CSOP to reward staff. Both arrangements are widely used across the UK. This Practice Note explores how the two arrangements differ, indicating when a company might prefer one over the other and outlining the distinct advantages each provides. It is intended to signpost scenarios in which a company would adopt one scheme in preference to the other, and to summarise the benefits available under each. It offers only a high-level summary and should be read alongside Practice Notes: How EMI schemes work and key features and How CSOPs work and key...
Relevance of the takeover code to share acquisitions by an EBT In certain situations, the Takeover Panel ( Panel) may need to be approached where a trustee of an employee benefit trust ( EBT) is purchasing shares in a company. Where the trustee might be deemed to be acting in concert with others when making such purchases, it could trigger an obligation for the trustee to make a comparable offer to all remaining shareholders, in line with the City Code on Takeovers and Mergers ( Code). The Panel can be asked to determine whether, for the purposes of the Code, an EBT trustee will be presumed to be acting in concert. In particular cases, the Code stipulates that the Panel must be consulted in advance of specific share acquisitions by an EBT, as outlined below. The Panel’s principal roles are to publish and enforce the Code, and to...
What is an employee ownership trust An employee ownership trust ( EOT) is a distinct form of employee benefit trust ( EBT) that must satisfy defined statutory conditions. EOTs were brought in by the Finance Act 2014, alongside particular tax advantages made available both to companies owned by an EOT and to individuals who transfer shares to an EOT. Where the strict legal requirements are not met in relation to the EOT, those tax reliefs will not apply. These statutory thresholds and conditions are central to qualification for any associated tax reliefs available under EOTs. For more information on EOTs and the legislative tests they are required to meet, see Practice Note: Employee ownership trusts. For guidance on pitfalls and frequent errors to watch for when establishing and running an EOT, see Practice Note: Pitfalls of setting up and operating an...
Disguised remuneration and share schemes For many years, HMRC has sought to ensure that benefits arising from employment are taxed under income tax with National Insurance contributions ( NICs) operated by employers through the pay as you earn ( PAYE) regime. In contrast, some employers adopted inventive remuneration structures, using employee benefit trusts ( EBTs) and other vehicles to avoid, delay, or reduce income tax exposure. In 2011, anti-avoidance provisions known as the disguised remuneration rules were introduced in Part 7A of the Income Tax ( Earnings and Pensions) Act 2003 ( ITEPA 2003). HMRC’s guidance is set out in the Employment Income Manual beginning at EIM45000. The legislation applies where: there is an arrangement that relates to a current, former or prospective employee, or a relevant person connected to the employee. For these purposes, employee includes...
FORTHCOMING CHANGE: Following the Autumn Budget 2024, the government set up an independent examination of the loan charge to review its operation and practical impact. Formally unveiled on 23 January 2025, the review’s remit was to ‘examine the barriers preventing those who are subject to the loan charge but have not already settled and paid their tax liabilities in full from reaching resolution with HMRC’ and to ‘recommend ways in which they can be encouraged to settle with HMRC’ (see News Analysis: Autumn Budget 2024— Independent review of the loan charge). To support this work, a call for evidence directed at individuals still within scope of the loan charge (and their advisers) was issued on 28 March 2025 for public consultation. The Final Report, together with the government’s response, appeared at Budget 2025 on 26 November 2025. In addition, the report concluded that the loan...
FORTHCOMING CHANGE: Following the Autumn Budget 2024 announcement, the government initiated an independent review into the loan charge in question. Formally launched on 23 January 2025, the review’s brief was to examine, in particular, obstacles stopping those still affected by the loan charge, who have yet to settle and pay their tax liabilities in full, from reaching agreement with HMRC, and to recommend how they might be encouraged to reach settlement with HMRC (see News Analysis: Autumn Budget 2024— Independent review of the loan charge). To support this work, a call for evidence aimed at individuals remaining within the scope of the loan charge, and their advisers, was issued on 28 March 2025. The review’s Final Report, together with the government response, was released at Budget 2025 on 26 November 2025......
Practice Note This Practice Note addresses the extra statutory and regulatory obligations that apply to UK listed companies concerning directors’ service contracts, drawing together the pertinent provisions of the Companies Act 2006 ( CA 2006), the Financial Conduct Authority’s UK Listing Rules ( UKLR) and the UK Corporate Governance Code ( UKCG Code) issued by the Financial Reporting Council ( FRC). It further signposts guidance from The Chartered Governance Institute ( CGI) and institutional investor best practice materials. All UK companies, including those with a listing, are subject to the requirements of CA 2006 in full......
The directors’ report plays a crucial role by giving shareholders insight into the company’s business that may not be evident from the financial information in the accounts. The framework for preparing the directors’ report is set out in Part 15 of the Companies Act 2006 ( CA 2006), which also specifies basic content requirements. More detailed rules on the content of directors’ reports are contained in regulations made under CA 2006, s 416(4). The exact obligations depend on the size of the company... Government withdraws draft corporate reporting regulations In October 2023, the UK government announced it would withdraw the draft Companies ( Strategic Report and Directors’ Report) ( Amendment) Regulations 2023 after consultation with companies raised concerns about imposing extra reporting requirements. Laid before Parliament in July 2023, the draft would have introduced several new corporate reporting obligations for very large UK...
This Practice Note sets out the statutory, regulatory and corporate governance regime for directors’ remuneration reports (including the directors’ remuneration policy), together with related practical guidance. Law and regulation The Companies Act 2006 ( CA 2006) and the Large and Medium-sized Companies and Groups ( Accounts and Reports) Regulations 2008, SI 2008/410 (2008 Regulations) require the directors of a quoted company to produce, annually, a remuneration report disclosing specified particulars of directors’ remuneration. Under CA 2006, a quoted company is a UK company whose shares are either listed on the Official List of the London Stock Exchange, listed in an EEA state, or admitted to dealing on the New York Stock Exchange or NASDAQ. The AIM market, the AQSE Growth Market (formerly NEX Exchange Growth Market), and overseas companies are not within the directors’ remuneration reporting regulations......
Introduction Partnerships, whatever their scale, still wrestle with shaping partner pay frameworks that feel equitable, drive the right behaviours, and underpin strategic growth. The environment is ever more intricate, demanding, and unpredictable; volatility and uncertainty now set the agenda for leaders worldwide. As organisations change, so must the mechanisms used to assess and reward owners. What are the implications for the partnership model, and how do firms build resilience to survive and prosper in this landscape? This Practice Note reviews the present landscape of partner remuneration, flags new themes and innovations, and tests whether a partnership’s approach is future‑proofed. Evolution of partnerships Partnerships were once small, collegiate enterprises. Partners typically worked from a single office, split profits on an equal basis, and seldom moved on before retirement. Over the last three decades, the professionalisation and...
This Practice Note sets out the key questions to consider when using performance conditions in an employee incentive plan. It covers: what is a performance condition? why performance conditions are used what criteria should be met when setting performance conditions performance conditions and corporate governance typical performance conditions performance periods implementing the performance condition(s) how the performance plan is communicated and operated What is a performance condition? A performance condition is a pre‑determined requirement that must be satisfied before the award holder can realise value from an option or award, and is therefore most often tied to the vesting of the award or, as applicable, the ability to exercise the option. Performance conditions can concern various matters, but commonly relate to: the performance of the company as a whole the performance of part of the company or a...
This Practice Note outlines the duties imposed on quoted companies regarding the creation, implementation and ongoing operation of a deferred share bonus plan. For a fuller overview of deferred share bonus plans, see Practice Note: An introduction to deferred share bonus plans. UK Listing Rules By their very nature, deferred share bonus plans will typically constitute employees’ share schemes under the Companies Act 2006 ( CA 2006), as they are commonly established to promote or enable the holding of shares in the company by or for employees’ benefit. The UK Listing Rules ( UKLR) adopt the CA 2006 definition, which covers any scheme: that encourages or facilitates the holding of shares in, or debentures of, a company by or for the benefit of: the bona fide employees or former employees of the company, any of its...
Capital gains tax—basic principles When someone disposes of an asset and realises a profit that is capital in nature, this could amount to a taxable capital gain. In assessing whether a liability to tax arises, there are several matters to review: the asset, the act of disposal, and the individual making that disposal must each be of a kind that can fall within capital gains tax ( CGT) the ‘consideration minus costs’ calculation must produce a positive figure: for more on computing the gain, see Practice Note: How is a capital gain calculated? an exemption or relief might be available: certain assets, and certain persons, are wholly outside CGT (see Practice Note: What is a capital gain?) ...
The requirements for a company share option plan ( CSOP) rollover are intricate and technical. This note will explore: what a CSOP rollover is why a CSOP rollover might be used when a CSOP rollover can be applied the eligibility tests that must be met for a CSOP rollover the timing constraints for a CSOP rollover the consequences of issuing replacement options how selective and partial rollovers operate frequent misconceptions and errors around CSOP rollovers What is a CSOP rollover? CSOP legislation permits the grant of replacement options to existing optionholders after a takeover of the scheme company (whose shares were under option), in a way that carries across the favourable tax treatment of the original CSOP options into the new awards. The replacement CSOP options must be equivalent to the original awards, but instead relate to shares in the acquiring company. While the expression “rollover” is widely used, the...
When designed, operated and monitored correctly, in line with company share option plan ( CSOP) legislation, the income tax and National Insurance contributions ( NICs) position for qualifying CSOP options can be highly advantageous in tax terms. This Practice Note outlines the income tax and NICs treatment of qualifying CSOP options with reference to, and in accordance with, Part 7, Chapter 8 of the Income Tax ( Earnings and Pensions) Act 2003 ( ITEPA 2003). For further discussion of the capital gains tax and corporation tax consequences of CSOP options, see Practice Note: CSOP— CGT treatment and corporation tax treatment. Income tax—basic principles Income tax is charged on income, though not every form of income is taxable. Individuals are assessed only on ‘taxable income’ above a particular threshold. Numerous reliefs and allowances can reduce the overall tax due. For an outline of the income tax...
Company share option plans ( CSOPs) These are statutory, tax‑advantaged, discretionary share option arrangements that may run on an all‑employee basis, though they are more often applied selectively. Where the statutory rules are satisfied, favourable tax treatment may follow. The CSOP framework is prescriptive, laying down multiple conditions to be met both at grant and at exercise, covering matters relating to: the company issuing the options the employees to whom options are granted, and the shares placed under option Detailed conditions apply at each key stage of an option’s lifecycle. They govern eligibility of issuer, recipients and underlying shares alike. This Practice Note concentrates on the CSOP eligibility criteria that must be met by the company and by the shares to be put under option. Those criteria are explained with reference to the income tax relief contained in sections 521–526 of the Income Tax (...
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When evaluating a general damages claim, the practitioner ought initially to refer to the Judicial College Guidelines (JCG)...
This Practice Note This Practice Note reviews mechanisms used in settling litigation. A Tomlin order consists of a consent order paired with a schedule. It operates to stay proceedings on terms that have been agreed. The provisions contained in the schedule may remain confidential. This Practice Note describes the scope of confidentiality attaching to the schedule and sets out how it differs from a standard consent order. Sample wording for a Tomlin order is included, alongside links to precedents, as well as guidance on court approval. It also addresses varying, setting aside and enforcing a Tomlin order, including the considerations the court will take into account when handling applications for each. Further guidance is provided on interpreting and applying the relevant provisions of the CPR; however, some courts and divisions impose very specific requirements for both drafting and approval, and for approaching the schedule and confidentiality issues. Accordingly, you must consider the particular rules and court guide provisions in the forum where your claim is proceeding when drawing up the Tomlin order...
Date [ date ] Parties [ name of Landlord ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Landlord) [ name of Tenant ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Tenant) [ [ name of Guarantor ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Guarantor) ] [ [ name of Mortgagee ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Mortgagee) ] Definitions Within this Deed, the terms below shall be interpreted as follows: [ Annual Rent • the annual sum reserved under the Lease; ] [ Insurance Rent • the Tenant’s share of the Landlord’s costs of insuring the Property (as set out in the Lease); ] Lease • the lease of the Property dated [ date ], entered into between (1) [ the Landlord OR [ name ...
I, [ name ], of [ address ], solemnly and sincerely state that: [ Matters to be verified, set out in numbered paragraphs ] I make this solemn statement in good conscience, believing it to be true, and pursuant to the provisions of the Statutory Declarations Act 1835. DECLARED at [ details ] this [ day ] day of [ month and year ] Before me ................................................................................ [ signature of the person before whom the declaration is made ] A [ commissioner for oaths OR [ solicitor OR [ insert other qualification ] ] authorised to administer oaths ]...
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