A pay program that Credit Suisse enacted during 2004 and 2005 to retain senior staff will help some of its senior executives avoid this year’s bonus tax and the 50% UK income tax.
It’s called the PIP (pay incentive plan) and it links pay to long-term performance much like Goldman Sachs did, by not allowing senior bankers to cash in stock for five years.
Credit Suisse’s handling of the bonus tax made news two weeks ago, too, when they announced that 400 UK managing directors would bear the brunt of the Chancellor’s 50 per cent bonus tax.
Well, now we find out that the group of 400 UK MDs actually includes the senior executives that are exempt from the tax under the PIP. Luckily for them, they will not have to pay.
The rest will see their bonuses drop 30% from what they were expected to be.
According to the Times Online, the group of senior figures that will get the tax-free bonuses includes James Leigh-Pemberton, head of Credit Suisse in the UK and one of the Government’s key advisers on the banking bailout.