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Selling pre-IPO startup shares in the UK: EMI options, tax and process

The UK has an active secondary market — but if you hold EMI options you exercise first, then sell. Here’s what you hold, what the Articles control, and how CGT (and Business Asset Disposal Relief) works.

Written & maintained by the PrivateTechShares team · Published September 2026 · Reviewed September 2026

Quick answer. If you hold EMI options you exercise first, then sell. The sale gain is subject to Capital Gains Tax (18% or 24%); qualifying EMI shares can get Business Asset Disposal Relief at 18% on gains up to a £1m lifetime limit (from 6 April 2026). Your Articles' pre-emption rights usually mean offering the shares internally first.

The UK has one of Europe’s more active secondary cultures, and selling private company shares is very possible — but it depends on what you hold and what your paperwork allows.

What do you hold? EMI options, unapproved options, or shares

What the paperwork controls

Your company’s Articles of Association and shareholders’ agreement usually contain a right of first refusal (pre-emption), transfer restrictions, and sometimes drag-along / tag-along rights. These shape how a sale happens rather than blocking it — typically you offer the shares internally first, and if there’s no taker you’re free to sell to your buyer.

EMI holders: the order is exercise the vested options into shares, then sell. Mind any post-leaver exercise window if you’ve left the company.

Tax when you sell

A share sale gain is generally subject to Capital Gains Tax (CGT). Crucially, qualifying EMI shares can attract Business Asset Disposal Relief (formerly Entrepreneurs’ Relief), which reduces the CGT rate on qualifying gains up to a £1m lifetime limit — that relief rate is 18% from 6 April 2026 (it was 10%, then 14% from April 2025). Standard CGT on a share sale is 18% or 24%. The conditions are specific and rates have been changing, so confirm your position with a UK tax adviser. Source ↗

The process, at a high level

Confirm what you hold (and exercise EMI options into shares if needed) → check the Articles/shareholders’ agreement for pre-emption and approvals → agree a price → clear pre-emption → complete a stock transfer form and update the register.

Read next

Thinking about selling?

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Questions people ask

Can I sell my startup shares in the UK before an exit?
Yes, often. You can sell shares you own in a private UK company to a buyer before an exit, subject to the company's Articles and shareholders' agreement — typically a right of first refusal (pre-emption) and sometimes board approval. If you hold EMI or other options rather than shares, you generally must exercise them into shares first.
Do I pay tax when I sell EMI shares?
A gain on selling shares is generally subject to Capital Gains Tax. Qualifying EMI shares can attract Business Asset Disposal Relief on gains up to a £1m lifetime limit; that relief rate is 18% from 6 April 2026 (previously 10%, then 14%), and standard CGT on shares is 18% or 24%. Conditions are specific and rates have been changing, so confirm with a UK tax adviser.
How do I sell EMI options?
You cannot usually sell the options themselves. You exercise the vested EMI options (pay the exercise price) to convert them into shares, then sell the shares — subject to the company's pre-emption rights and transfer rules. If you have left the company, watch any post-leaver exercise window before the options lapse.
How we keep this accurate. We write from primary sources — official tax authorities (HMRC, IRS), financial regulators (FCA, SEC) and company filings — date every page, and review them regularly. This is independent, educational information, and deliberately not a substitute for professional tax, legal or financial advice on your own situation.

General information only — not financial, tax or legal advice, and not a substitute for advice from a qualified local professional. Tax rates and rules change and depend on your personal circumstances; the figures here are directional and simplified. Check your own share/option agreements and take local advice before selling. PrivateTechShares is an education and tools service: it is not a broker or marketplace, does not introduce buyers and sellers, does not hold funds, and does not execute or advise on transactions.