Finance Act 1989

Profit-related pay, share schemes etc. E+W+S+N.I.

[F1 61 Profit-related pay. E+W+S+N.I.

Schedule 4 to this Act (which amends the provisions of the Taxes Act 1988relating to profit-related pay) shall have effect.]

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Amendments (Textual)

F1 S. 61 repealed (19.3.1997 with effect as mentioned in Sch. 18 Pt. VI(3), notes 1, 2 of the amending Act) by 1997 c. 16, ss. 61(2)(3), 113, Sch. 18 Pt. VI(3)

62 Savings-related share option schemes. E+W+S+N.I.

(1) Part III of Schedule 9 to the Taxes Act 1988 (requirements applicable tosavings-related share option schemes) shall be amended as follows.

(2) In paragraph 24(2)(a) (scheme not to permit monthly amount ofcontributions linked to schemes to exceed £100), for “£100”there shall be substituted “£150”.

(3) In paragraph 25(b) (requirement that price at which share may be acquiredunder scheme be not less than 90 per cent. of market value), for the words “90 per cent.” there shall be substituted the words “80 per cent.”.

(4) Subsection (2) above shall come into force on such day as the Treasury mayby order made by statutory instrument appoint.

F2 63 Profit sharing schemes. E+W+S+N.I.

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Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Amendments (Textual)

F2 S. 63 repealed(having effect for the year 1991-92 and subsequent years of assessment) by Finance Act 1991 (c. 31, SIF 63:1), s. 123, Sch. 19 Pt.V Note 6.

64 Share option and profit sharing schemes: shares of consortium member. E+W+S+N.I.

In paragraph 10 of Schedule 9 to the Taxes Act 1988, paragraph (c)(ii)(which requires a consortium member to hold not less than three-twentieths ofshare capital of grantor company etc. if member’s shares are to qualify asscheme shares) shall cease to have effect.

65 Employee share schemes: material interest. E+W+S+N.I.

In Schedule 9 to the Taxes Act 1988 the following paragraph shall beinserted after paragraph 39—

“ Shares subject to an employee benefit trust

40 (1) Where an individual has an interest in shares or obligations of thecompany as a beneficiary of an employee benefit trust, the trustees shall notbe regarded as associates of his by reason only of that interest unlesssub-paragraph (3) below applies in relation to him.

(2) In this paragraph “employee benefit trust” has the samemeaning as in paragraph 7 of Schedule 8.

(3) This sub-paragraph applies in relation to an individual if at any time onor after 14th March 1989—

(a) the individual, either on his own or with any one or more of hisassociates, or

(b) any associate of his, with or without other such associates,

has been the beneficial owner of, or able (directly or through the mediumof other companies or by any other indirect means) to control, more than 25per cent., or in the case of a share option scheme which is not asavings-related share option scheme more than 10 per cent., of the ordinaryshare capital of the company.

(4) Sub-paragraphs (9) to (12) of paragraph 7 of Schedule 8 shall apply forthe purposes of this paragraph in relation to an individual as they apply forthe purposes of that paragraph in relation to an employee.”

66 Priority share allocations for employees etc. E+W+S+N.I.

(1) In relation to offers made on or after 11th October 1988, section 68 ofthe M1 Finance Act 1988 (which provides for the benefitsderived from priority rights in share offers to be disregarded in certaincircumstances) shall have effect with the following amendments.

(2) In subsection (1), the words from “at the fixed price” to “tendered” shall be omitted.

(3) After that subsection there shall be inserted—

“(1A) Where the price payable by the director or employee is less than the fixedprice or the lowest price successfully tendered, subsection (1) above shallnot apply to the benefit represented by the difference in price.”

(4) In subsection (2), for paragraph (a) (priority shares not to exceed 10 percent. of shares subject to the offer) there shall be substituted—

“(a) that the aggregate number of shares subject to the offer that may beallocated as mentioned in subsection (1)(b) above does not exceed the limitspecified in subsection (2A) below or, as the case may be, either of thelimits specified in subsection (2B) below”.

(5) After subsection (2) there shall be inserted—

“(2A) Except where subsection (2B) below applies, the limit relevant for thepurposes of subsection (2)(a) above is 10 per cent. of the shares subject tothe offer (including the shares that may be allocated as mentioned insubsection (1)(b) above).

(2B) Where the offer is part of arrangements which include one or more otheroffers to the public of shares of the same class, the limits relevant for thepurposes of subsection (2)(a) above are—

(a) 40 per cent. of the shares subject to the offer (including the shares thatmay be allocated as mentioned in subsection (1)(b) above), and

(b) 10 per cent. of all the shares of the class in question (including theshares that may be so allocated) that are subject to any of the offers formingpart of the arrangements.”

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Marginal Citations

M1 1988 c. 39.