Section 186A | The number of employees requirement

(1)If the issuing company is a single company, the full-time equivalent employee number for it must be less than the permitted limit when the relevant shares are issued.

(2)If the issuing company is a parent company, the sum of—

(a)the full-time equivalent employee number for it, and

(b)the full-time equivalent employee numbers for each of its qualifying subsidiaries,

must be less than the permitted limit when the relevant shares are issued.

(3)The full-time equivalent employee number for a company is calculated as follows—Step 1Find the number of full-time employees of the company.Step 2Add, for each employee of the company who is not a full-time employee, such fraction as is just and reasonable.The result is the full-time equivalent employee number.

(3A)The permitted limit” means—

(a)if the issuing company is a knowledge-intensive company (see section 252A) at the time the relevant shares are issued, 500, and

(b)in any other case, 250.

(3B)The Treasury may by regulations amend subsection (3A)(a) or (b) by substituting a different number for the number for the time being specified there.

(4)In this section references to an employee—

(a)include a director, but

(b)do not include—

(i)an employee on maternity , paternity , shared parental , parental bereavement or neonatal care leave, or

(ii)a student on vocational training.