ICAEW Share Scheme Valuations
HMRC-Defensible in 5–10 Days.
Independent, Restricted Market Value (RMV) and Unrestricted Market Value (UMV) share price justification for UK non-EMI schemes. We provide forensic appraisals for Section 431 elections, growth shares, hurdle shares, Company Share Option Plans (CSOP), and unapproved options using advanced Black-Scholes and Monte Carlo pricing models.
Get the share scheme valuation wrong, and HMRC re-prices it for you — with punitive interest.
Outside of EMI, you generally cannot pre-agree the valuation with HMRC Shares and Assets Valuation (SAV). That makes the mathematical methodology and audit trail everything. Three reasons UK founders engage us for non-EMI equity schemes.
Section 431: 14 days, no second chance
A Section 431 election tightly locks in income tax on the Unrestricted Market Value (UMV) at acquisition. Sign it within 14 days of the share issue — using a credible, contemporaneous valuation — and future equity growth is subject to Capital Gains Tax (CGT). Miss it or deliberately under-value it, and HMRC will challenge you years later.
Growth shares need a real economic hurdle
Growth / hurdle shares only deliver strict capital-gains treatment if the hurdle reflects a highly defensible enterprise value at issue. A weak valuation quickly collapses the structure into employment income on exit. We utilize rigorous option pricing models to justify the hurdle rate mathematically.
Unapproved options & CSOP need audit-ready numbers
Unapproved option exercises immediately trigger income tax and NIC at market value on exercise. Whether you're granting CSOP within the strict £60k statutory limit or running a non-tax-advantaged plan, HMRC fully expects a documented methodology you can produce on formal enquiry.
Three steps. 5–10 days to report. Partner-led throughout.
No handoffs to junior analysts. No generic template output. Every share scheme valuation is prepared, modeled, and signed off personally by an ICAEW Chartered Accountant.
Submit your details
Send 3 years of statutory accounts, your live cap table, and a short note on the equity scheme you're putting in place. We confirm the scope and fixed fee within one business day.
Modelling & methodology
We rigorously apply the corporate finance methodology HMRC expects to see: DCF, normalised EBITDA multiples, comparable M&A transactions and — for growth shares — advanced option pricing models (Black-Scholes or Monte Carlo simulations) for the hurdle.
Signed report & methodology memo
You receive a board-ready valuation report, a detailed methodology memorandum, and all supporting financial workings — comprehensively audit-ready in case HMRC enquires in the future.
A complete, HMRC-defensible share scheme valuation pack.
- Restricted & Unrestricted Market ValueBoth the RMV and UMV are derived and documented, precisely applying the restriction discounts (DLOC/DLOM) HMRC fully expects to see for s.431 and growth share work.
- Methodology memorandumDCF, EBITDA multiples, and comparable transactions, strictly detailing sources, sector benchmarks, and sensitivities — plus robust option pricing logic for growth share hurdles.
- Section 431 / option grant supportA plain-English executive summary your corporate lawyer can directly attach to the s.431 election, option grant deed, or CSOP scheme rules.
- Cap-table & dilution analysisPre- and post-scheme cap table modelling so you can clearly see employee dilution and equity waterfall outcomes at a target M&A exit.
- Board pack & adviser briefA concise summary you can instantly drop into your board minutes and share seamlessly with your scheme lawyer or statutory auditor.
- Future-enquiry defence fileFull working papers are securely archived so the valuation can be aggressively defended on HMRC enquiry years after the initial grant.
Kishen Patel — ICAEW Chartered Accountant, BFP ACA
Kishen has over 12 years of deep experience across Big Four audit (Deloitte), investment banking, and corporate advisory. He founded Consult EFC to give ambitious UK SMEs seamless access to the same calibre of corporate financial thinking previously reserved exclusively for large corporates — at a transparent fee that makes sense for a growing scaleup.
Every single share scheme valuation is prepared, rigorously modelled, and signed personally. No analyst stack. No generic template report. The exact same person who quotes you is the highly qualified professional whose name is on the methodology memo if HMRC ever opens an enquiry.
Founders and finance directors who chose an ICAEW expert over a software template.
The work was handled entirely professionally. Kishen kept us informed at every stage of the equity process and the report was exactly what our corporate tax advisers needed.
We needed a growth share valuation that would hold up under intense outside scrutiny. Kishen delivered a report that was called one of the most rigorous our lawyers had seen from an SME.
We used an automated online tool before speaking to Consult EFC. The difference was night and day. The figure Kishen produced was materially higher and fully mathematically defensible.
What UK founders ask before instructing us.
Can I pre-agree a non-EMI share valuation with HMRC?
No. HMRC's Shares and Assets Valuation (SAV) team only pre-agrees valuations for EMI and CSOP (in very limited cases). For Section 431 elections, growth shares, and unapproved options, you cannot legally secure an advance clearance. This makes the inherent quality, robustness, and audit trail of your independent valuation absolutely everything if HMRC formally enquires months or years later.
What is a Section 431 election and why does the valuation matter?
A Section 431 (s.431) election is a joint tax election signed by the employer and employee within 14 days of share acquisition. It legally elects to be taxed on the Unrestricted Market Value (UMV) at the point of acquisition, meaning any future growth strictly qualifies for Capital Gains Tax (CGT) treatment instead of punitive Income Tax. The valuation underpinning it must be highly contemporaneous and defensible — under-valuing it is the single most common cause of later HMRC tax challenges.
How do growth share valuations work?
Growth shares only deliver equity value to the employee above a rigidly defined hurdle (typically today's Enterprise Value plus a yield/coupon). Their value at issue is very small, but mathematically not zero. We precisely model it using advanced option pricing approaches (such as Black-Scholes or Monte Carlo simulations) so the hurdle is fundamentally defensible and the s.431 election sticks without friction.
How long does a share scheme valuation take?
We typically deliver a signed ICAEW report in 5 to 10 business days once we have your statutory accounts, cap table, and a short description of the scheme’s mechanics. For s.431 elections, we work aggressively to accommodate your strict 14-day execution deadline.
How much does a share scheme valuation cost?
We quote a bespoke fixed fee up-front, typically representing a fraction of what a Big Four accounting firm would charge for the exact same scope. The fee depends entirely on company size, the scheme type (s.431, growth shares, options, JSOP), and whether multiple share classes are currently in issue. There are no hourly charges and no hidden surprises.
Do you work alongside our scheme lawyer or tax counsel?
Yes. We routinely work collaboratively with employee share scheme lawyers and corporate tax counsel — seamlessly providing the core valuation, the methodology memo, and any supporting financial analysis your legal team needs for the scheme documents and the s.431 election filings.
A defensible number, signed off by an ICAEW Chartered Accountant.
- Fixed fee, quoted within one business day
- Report delivered in 5–10 business days
- Methodology memo + working papers archived for future HMRC enquiry
- Partner-led from quote to signed report — no junior analysts
- Strictly Confidential. Trusted by SME owners across the UK.
Prefer to talk? +44 7767 629 008 · info@consultEFC.com