Talk about the WEG to the 2020 Fiscal Forum (26 March 2020)
William Franklin – WEG Chairman
Good morning everyone. My name is William Franklin.
- I’m a chartered accountant
- I’m a Partner at Pett Franklin – a multidisciplinary law firm that specialises in employee share schemes and valuation
- And I’m the Chairman of the Share Valuation Worked Examples Group
Which is what I’m here to talk to you about today.
So what is the Share Valuation Worked Examples Group? Which I’ll refer to as the WEG henceforth.
The WEG is a committee of share valuation specialists working collaboratively with HMRC to ameliorate uncertainty relating to the tax valuation of unquoted companies for the purpose of employee share schemes.
The WEG focuses on:
- And publishing
Worked examples of the valuation of employee share schemes.
It is worth emphasising what the WEG is not.
- It is not an organisation to resolve tax disputes.
- It is not an organisation to address legal uncertainties.
- It does not produce specific valuations or give any advice in specific cases.
- It is not a lobbying group for changes in legislation.
- And is not a backdoor to a Post Transaction Value Check.
The WEG was sponsored at inception by the UK’s 4 principal share scheme support membership groups:
- The ESOP centre
- Pro Share
- The Employee Ownership Association (EOA)
- And the Share Plan Lawyers Group
And the WEG committee comprises representatives from these groups and other experts which are co-opted to the WEG committee. The WEG endeavours to represent a diverse range of views which is reflected in our membership base, comprising experts from organisations such as:
- The Big 4
- Independent boutiques
- And everything in between.
But most importantly the WEG committee comprises senior representation from HMRC. It is this relationship between the WEG and HMRC that makes the WEG unique. The WEG acts as a filter and a buffer between HMRC, advisers and the general public and helps HMRC hear about market issues and solutions.
The goal of the WEG is to produce more worked examples which will be published by HMRC on its website or in its valuation manual and by the WEG itself and its co-sponsors. As I said WEG is about finding market solutions to market problems in an efficient and productive way by collaborating with HMRC. It aims to democratise the process by embracing open-source principles. For example:
- The WEG is accessible. It posts all of its examples on its website for anybody to access.
- The WEG encourages anybody to submit an example for scrutiny and discussion.
- And the WEG continues to invest in technology to facilitate an open relationship with interested parties
In accordance with our open source philosophy we welcome anyone to come forward with new worked examples for the WEG to review or propose changes to existing worked examples.
I’ve spoken about what the WEG is. Now I’d like to address what is meant by a worked example.
A worked example is a narrative description of a set of circumstances and an explanation of the value of the shares in those circumstances.
- It is a story.
- It is not a manual.
- And it is not a general solution or formula.
What it is, is an explanation of how the value of shares can be arrived at in particular circumstances which can give some general guidance as a frame of reference for similar circumstances.
It is this frame of reference – which is made publicly available – that can help reduce uncertainty and accelerate the process of valuing employee shares.
Now I’ve explained what the WEG is and what a worked example is, I’ll explain why the WEG came into being.
The WEG emerged from the removal of the Post Transaction Valuation Check in 2016. HMRC recognised the need in this new environment for new mechanisms for feedback and dialogue between itself and advisers to help mitigate uncertainty for tax payers. As such the WEG was born as a collaboration between HMRC and advisers to provide guidance on the valuation of employee share schemes. In accordance with our open source approach the WEG is open to people with relevant skills and experience joining the WEG committee.
We have provided guidance on a number of worked examples already and are working actively on some more. And I think we are an example of productive collaboration between the public and private sector.
So there you have it. That is what the WEG is. What a worked example is. And why the WEG came into being.
On behalf of the WEG I’d like to thank you for listening and I’d encourage you to view our website at
And if you have a share valuation worked example you’d like to have considered by the WEG please send it to: