Income Tax (Earnings and Pensions) Act 2003

Section 516

SCHEDULE 3 U.K. Approved SAYE option schemes

Part 1 U.K. Introduction

Approval of SAYE option schemes U.K.

1 (1) This Schedule makes provision for the approval of SAYE option schemes by [F1 an officer of Revenue and Customs]. U.K.

(2) Parts 2 to 7 of this Schedule contain requirements that have to be met in order for schemes to be approved under this Schedule.

(3) The requirements consist of general requirements (see Part 2) and requirements as to—

• the eligibility of individuals to participate in a scheme (see Part 3),

• the shares to which schemes can apply (see Part 4),

• the existence of a linked [F2 savings arrangement] (see Part 5),

• the share options that may be granted under the scheme (see Part 6), and

• the exchange of share options (see Part 7).

(4) Part 8 of this Schedule deals with the approval of schemes and the withdrawal of approval.

Textual Amendments

F1 Words in Act substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 102(1); S.I. 2005/1126, art. 2(2)(h)

F2 Words in Sch. 3 para. 1(3) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(2) (with Sch. 2)

SAYE option schemes U.K.

2 (1) In the SAYE code an “SAYE option scheme” means (in accordance with section 516(4)) a scheme established by a company which provides— U.K.

(a) for share options to be granted to employees and directors, and

(b) for the shares acquired by the exercise of the share options to be paid for in the way mentioned in paragraph 24 (payments for shares to be linked to approved [F3 savings arrangements]).

(2) In the SAYE code, in relation to an SAYE option scheme—

• “participant” means an individual who has been granted (but has not yet exercised) share options under the scheme (“the options”);

• “participate” means obtain and exercise share options under the scheme;

• “the scheme organiser” means the company which has established the scheme.

Textual Amendments

F3 Words in Sch. 3 para. 2(1)(b) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(3) (with Sch. 2)

Group schemes U.K.

3 (1) An SAYE option scheme established by a company that controls one or more other companies (a “parent scheme company”) may extend to all or any of those other companies. U.K.

(2) In the SAYE code an SAYE option scheme established by a parent scheme company which so extends is called a “group scheme”.

(3) In relation to a group scheme a “constituent company” means—

(a) the parent scheme company, or

(b) any other company to which for the time being the scheme is expressed to extend.

(4) Paragraph 46 deals with jointly owned companies and companies controlled by them.

Part 2 U.K. General requirements for approval

General requirements for approval: introduction U.K.

4 U.K. An SAYE option scheme must meet the requirements of—

• paragraph 5 (general restriction on contents of scheme),

• paragraph 6 (all-employee nature of scheme),

• paragraph 7 (participation on similar terms), and

• paragraph 8 (no preferential treatment for directors and senior employees).

General restriction on contents of scheme U.K.

5 U.K. The scheme must not contain features which are neither essential nor reasonably incidental to the purpose of providing benefits for employees and directors in the nature of share options.

All-employee nature of scheme U.K.

6 (1) The scheme must provide that every person who meets the conditions in sub-paragraph (2) is eligible to participate in the scheme. U.K.

(2) A person (“E”) meets the conditions in this sub-paragraph if—

(a) E is an employee or a full-time director of the scheme organiser or (in the case of a group scheme) of a constituent company,

(b) E has been such an employee or director at all times during a qualifying period of not more than 5 years,

[F4 (c) E's earnings from the office or employment within paragraph (a) are (or would be if there were any) general earnings to which section 15 applies (earnings for year when employee UK resident), [F5 and]

F6 (ca) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

(d) E is not ineligible under paragraph 11 (the “no material interest” requirement).

(3) The scheme must not contain any feature which has or is likely to have the effect of discouraging any description of persons who—

(a) meet the conditions in sub-paragraph (2), or

(b) met those conditions before ceasing to be persons within sub-paragraph (2)(a),

from actually participating in the scheme.

(4) Sub-paragraph (3) does not apply to any provision required or authorised by a provision of this Schedule.

Textual Amendments

F4 Sch. 3 para. 6(2)(c)(ca) substituted for Sch. 3 para. 6(2)(c) (with effect in accordance with Sch. 7 para. 81 of the amending Act) by Finance Act 2008 (c. 9), Sch. 7 para. 42

F5 Word in Sch. 3 para. 6(2)(c) inserted (with effect in accordance with Sch. 46 para. 72 of the amending Act) by Finance Act 2013 (c. 29), Sch. 46 para. 41(1)(a) (with Sch. 46 para. 41(2))

F6 Sch. 3 para. 6(2)(ca) omitted (with effect in accordance with Sch. 46 para. 72 of the amending Act) by virtue of Finance Act 2013 (c. 29), Sch. 46 para. 41(1)(b) (with Sch. 46 para. 41(2))

Participation on similar terms U.K.

7 (1) The requirements of this paragraph are— U.K.

(a) that every person who meets the conditions in paragraph 6(2) (all-employee nature of scheme) must be eligible to participate in the scheme on similar terms, and

(b) that every person who participates in the scheme must actually do so on similar terms.

(2) The requirements of this paragraph are not infringed by the fact that the rights of those participating in the scheme to obtain and exercise share options vary according to—

(a) the levels of their remuneration,

(b) the length of their service, or

(c) any similar factors.

No preferential treatment for directors and senior employees U.K.

8 (1) The requirement of this paragraph is that, if the scheme organiser is a member of a group of companies, the scheme does not and is not likely to have the effect of conferring benefits wholly or mainly— U.K.

(a) on directors of companies in the group, or

(b) on employees of companies in the group who receive the higher or highest levels of remuneration.

(2) “A group of companies” means a company and any other companies of which it has control.

Part 3 U.K. Eligibility of individuals to participate in scheme

Requirements relating to the eligibility of individuals: introduction U.K.

9 U.K. An SAYE option scheme must meet the requirements of—

• paragraph 10 (the employment requirement),

• F7 ...

Textual Amendments

F7 Words in Sch. 3 para. 9 omitted (with effect in accordance with Sch. 2 para. 43 of the amending Act) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 40

The employment requirement U.K.

10 (1) The scheme must ensure that an individual is not eligible to participate in the scheme at a particular time unless the individual is then a director or employee of— U.K.

(a) the scheme organiser, or

(b) in the case of a group scheme, a constituent company.

(2) The requirement of this paragraph is not infringed by a provision of the scheme required or authorised by a provision of this Schedule.

The “no material interest” requirement U.K.

F8 11 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F8 Sch. 3 paras. 11-16 omitted (with effect in accordance with Sch. 2 para. 43 of the amending Act) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 41

Meaning of “material interest” U.K.

F8 12 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F8 Sch. 3 paras. 11-16 omitted (with effect in accordance with Sch. 2 para. 43 of the amending Act) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 41

Material interest: options and interests in SIPs U.K.

F8 13 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F8 Sch. 3 paras. 11-16 omitted (with effect in accordance with Sch. 2 para. 43 of the amending Act) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 41

Meaning of “associate” U.K.

F8 14 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F8 Sch. 3 paras. 11-16 omitted (with effect in accordance with Sch. 2 para. 43 of the amending Act) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 41

Meaning of “associate”: trustees of employee benefit trust U.K.

F8 15 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F8 Sch. 3 paras. 11-16 omitted (with effect in accordance with Sch. 2 para. 43 of the amending Act) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 41

Meaning of “associate”: trustees of discretionary trust U.K.

F8 16 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F8 Sch. 3 paras. 11-16 omitted (with effect in accordance with Sch. 2 para. 43 of the amending Act) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 41

Part 4 U.K. Shares to which schemes can apply

Requirements relating to shares that may be subject to share options: introduction U.K.

17 (1) An SAYE option scheme must meet the requirements of— U.K.

• paragraph 18 (shares must be ordinary shares of certain companies),

• paragraph 19 (requirements as to listing),

• paragraph 20 (shares must be fully paid up and not redeemable), [F9 and]

• F10 ...

• paragraph 22 (requirements as to other shareholdings).

(2) In this Part “eligible shares” means shares which may be acquired by the exercise of share options under the scheme.

Textual Amendments

F9 Word in Sch. 3 para. 17(1) inserted (with effect in accordance with Sch. 2 para. 67 of the amending Act) by Finance Act 2013 (c. 29), Sch. 2 para. 60(a)

F10 Words in Sch. 3 para. 17(1) omitted (with effect in accordance with Sch. 2 para. 67 of the amending Act) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 60(b)

Shares must be ordinary shares of certain companies U.K.

18 U.K. Eligible shares must form part of the ordinary share capital of—

(a) the scheme organiser,

(b) a company which has control of the scheme organiser, or

(c) a company which either is, or has control of, a company which is a member of a consortium owning either the scheme organiser or a company having control of the scheme organiser.

Requirements as to listing U.K.

19 (1) Eligible shares must be— U.K.

(a) shares of a class listed on a recognised stock exchange,

(b) shares in a company which is not under the control of another company, or

(c) shares in a company which is under the control of a listed company.

(2) A “listed company” is a company whose shares are listed on a recognised stock exchange, other than—

(a) a close company, or

(b) a company that would be a close company if resident in the United Kingdom.

Shares must be fully paid up and not redeemable U.K.

20 U.K. Eligible shares must be—

(a) fully paid up, and

(b) not redeemable.

Only certain kinds of restriction allowed U.K.

F11 21 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F11 Sch. 3 para. 21 omitted (with effect in accordance with Sch. 2 para. 67 of the amending Act) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 61

Requirements as to other shareholdings U.K.

22 (1) The majority of the issued shares of the same class as the eligible shares must be— U.K.

(a) employee-control shares, or

(b) open market shares,

unless the eligible shares are shares in a company whose ordinary share capital consists of shares of one class only.

(2) Shares in a company are “employee-control shares” if—

(a) the persons holding the shares are, by virtue of their holding, together able to control the company, and

(b) those persons are or have been employees or directors of the company or of another company which is under the control of the company.

(3) Shares in a company are “open market shares” if the persons holding the shares are not—

(a) persons who acquired their shares as a result of a right conferred on them or an opportunity afforded to them as a director or employee of the scheme organiser or any other company, and not as a result of an offer to the public, or

(b) trustees holding shares on behalf of persons who acquired their beneficial interests in the shares as mentioned in paragraph (a), or

(c) in the case of shares which—

(i) are not of a class listed on a recognised stock exchange, and

(ii) are in a company which is under the control of a listed company (as defined by paragraph 19(2)),

companies which have control of the company whose shares are in question or of which that company is an associated company.

Part 5 U.K. Requirement for linked savings [F12 arrangement]

Textual Amendments

F12 Word in Sch. 3 Pt. 5 heading substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(5)(a) (with Sch. 2)

Requirements as to linked savings [F13 arrangement] : introduction U.K.

Textual Amendments

F13 Word in Sch. 3 para. 23 heading substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(5)(a) (with Sch. 2)

23 U.K. An SAYE option scheme must meet the requirements of—

• paragraph 24 (payments for shares to be linked to approved [F14 savings arrangements]), and

• paragraph 25 (requirements as to contributions to [F14 savings arrangements]).

Textual Amendments

F14 Words in Sch. 3 para. 23 substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(5)(b) (with Sch. 2)

Payments for shares to be linked to approved savings [F15 arrangements] U.K.

Textual Amendments

F15 Word in Sch. 3 para. 24 heading substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(6)(a) (with Sch. 2)

24 (1) The scheme must provide for shares acquired by the exercise of share options granted under the scheme to be paid for with money not exceeding the amount of repayments made and any interest paid under a [F16 certified SAYE savings arrangement] which has been approved by [F1 an officer of Revenue and Customs] for the purposes of this Schedule [F17 (“the approved savings arrangement”)]. U.K.

F18 (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F1 Words in Act substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 102(1); S.I. 2005/1126, art. 2(2)(h)

F16 Words in Sch. 3 para. 24(1) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(6)(b) (with Sch. 2)

F17 Words in Sch. 3 para. 24(1) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(6)(c) (with Sch. 2)

F18 Sch. 3 para. 24(2) repealed (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(7), Sch. 3 (with Sch. 2)

Requirements as to contributions to savings [F19 arrangements] U.K.

Textual Amendments

F19 Word in Sch. 3 para. 25 heading substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(8)(a) (with Sch. 2)

25 (1) The scheme must provide for a person’s contributions under the [F20 the approved savings arrangement] to be of an amount that will secure, as nearly as possible, repayment of an amount equal to the option price. U.K.

(2) The “option price” means the amount payable, on exercising share options granted under the scheme, in order to acquire the maximum number of shares that may be acquired under them (see paragraph 28).

(3) The scheme must neither—

(a) permit the aggregate amount of a person’s contributions under [F21 certified SAYE savings arrangements linked to approved SAYE option schemes] to exceed £250 per month, nor

(b) impose a minimum on the amount of a person’s contributions which exceeds £10 per month.

(4) The Treasury may by order amend sub-paragraph (3) by substituting for any amount for the time being specified there an amount specified in the order.

Textual Amendments

F20 Words in Sch. 3 para. 25(1) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(8)(b) (with Sch. 2)

F21 Words in Sch. 3 para. 25(3)(a) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(8)(c) (with Sch. 2)

Repayments under a savings [F22 arrangement] : whether bonuses included U.K.

Textual Amendments

F22 Word in Sch. 3 para. 26 heading substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(9)(a) (with Sch. 2)

26 (1) For the purposes of this Schedule repayments under a [F23 certified SAYE savings arrangement] may be taken as including, or as not including, a bonus. U.K.

(2) The bonus may either be the maximum bonus under that [F24 arrangement] or a lesser bonus.

(3) An SAYE option scheme must require the question whether repayments are to be taken as including bonuses to be determined at the time when share options are granted.

Textual Amendments

F23 Words in Sch. 3 para. 26(1) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(9)(b) (with Sch. 2)

F24 Word in Sch. 3 para. 26(2) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(9)(c) (with Sch. 2)

Part 6 U.K. Requirements etc. relating to share options

Requirements etc. relating to share options: introduction U.K.

27 (1) An SAYE option scheme must meet the requirements of— U.K.

• paragraph 28 (requirements as to price for acquisition of shares),

• paragraph 29 (share options must not be transferable),

• paragraph 30 (time for exercising options: general),

• F25 ...

• paragraph 32 (exercise of options: death), [F26 and]

• F27 ...

• paragraph 34 (exercise of options: scheme-related employment ends).

(2) An SAYE option scheme may make any provision authorised by—

• paragraph 36 (exercise of options: employment in associated company at bonus date), and

• paragraph 37 (exercise of options: company events).

Textual Amendments

F25 Words in Sch. 3 para. 27(1) omitted (17.7.2013) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 8(a) (with Sch. 2 paras. 16, 17)

F26 Word in Sch. 3 para. 27(1) inserted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 2 para. 8(b) (with Sch. 2 paras. 16, 17)

F27 Words in Sch. 3 para. 27(1) omitted (17.7.2013) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 8(c) (with Sch. 2 paras. 16, 17)

Requirements as to price for acquisition of shares U.K.

28 (1) The price at which shares may be acquired by the exercise of a share option granted under the scheme— U.K.

(a) must be stated at the time when the option is granted, and

(b) must not be manifestly less than 80% of the market value of shares of the same class at that time.

This is subject to sub-paragraphs (2) and (3).

(2) [F1 An officer of Revenue and Customs] and the scheme organiser may agree in writing that sub-paragraph (1)(b) is to apply as if the reference to the time when the option is granted were to an earlier time or times stated in the agreement.

(3) The scheme may provide for one or more of the following—

(a) the price at which shares may be acquired by the exercise of a share option granted under the scheme,

(b) the number of shares which may be so acquired, or

(c) the description of shares which may be so acquired,

to be varied so far as necessary to take account of a variation in the share capital of which the shares form part.

(4) But the scheme must provide that no such variation is to be made without the prior approval of [F1 an officer of Revenue and Customs].

[F28 (5) At the time a share option is granted—

(a) it must be stated whether or not the shares which may be acquired by the exercise of the option may be subject to any restriction, and

(b) if so, the details of the restriction must also be stated.

(6) For the purposes of this paragraph the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.]

Textual Amendments

F1 Words in Act substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 102(1); S.I. 2005/1126, art. 2(2)(h)

F28 Sch. 3 para. 28(5)(6) inserted (with effect in accordance with Sch. 2 para. 67 of the amending Act) by Finance Act 2013 (c. 29), Sch. 2 para. 62

Share options must not be transferable U.K.

29 (1) The scheme must ensure that share options granted to a participant are not capable of being transferred by the participant. U.K.

(2) Paragraph 32 provides for the exercise of the options where the participant has died.

Time for exercising options: general U.K.

30 (1) The scheme must ensure that share options granted under it must not be capable of being exercised— U.K.

(a) before the bonus date, or

(b) later than 6 months after that date.

(2) However, in sub-paragraph (1)—

(a) paragraph (a) is subject to paragraphs [F29 32,] 34 and 37 (exercise of options in the event of death, F30 ... scheme-related employment ending or certain events occurring in relation to the company), and

(b) paragraph (b) is subject to paragraph 32.

(3) In the SAYE code “the bonus date” means the date on which repayments under [F31 the approved savings arrangement] are due.

(4) For this purpose repayments are to be regarded as due as follows—

(a) if the repayments are to be taken as including the maximum bonus (see paragraph 26(2)), on the earliest date on which that bonus is payable, and

(b) in any other case, on the earliest date on which a bonus is payable.

Textual Amendments

F29 Word in Sch. 3 para. 30(2)(a) substituted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 2 para. 9(a) (with Sch. 2 paras. 16, 17)

F30 Words in Sch. 3 para. 30(2)(a) omitted (17.7.2013) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 9(b) (with Sch. 2 paras. 16, 17)

F31 Words in Sch. 3 para. 30(3) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(10) (with Sch. 2)

Requirement to have a “specified age” U.K.

F32 31 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F32 Sch. 3 para. 31 omitted (17.7.2013) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 10 (with Sch. 2 paras. 16, 17)

Exercise of options: death U.K.

32 U.K. The scheme must provide that, if a participant dies before exercising the options, they may be exercised on or after the date of death but not later than—

(a) 12 months after the date of death, in a case where the participant dies before the bonus date, or

(b) 12 months after the bonus date, in a case where the participant dies on or within 6 months after that date.

Exercise of options: reaching specified age without retiring U.K.

F33 33 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F33 Sch. 3 para. 33 omitted (17.7.2013) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 11 (with Sch. 2 para. 17)

Exercise of options: scheme-related employment ends U.K.

34 (1) The scheme must provide that, if a participant (“P”) no longer holds scheme-related employment (see paragraph 35), the options are exercisable as set out in sub-paragraphs (2) to (4). U.K.

(2) In a case where P ceases to hold the scheme-related employment because of—

(a) injury or disability or redundancy within the meaning of ERA 1996 [F34 or ER(NI)O 1996 ], F35 ...

(b) retirement F36 ...,

[F37 (c) a relevant transfer within the meaning of the Transfer of Undertakings (Protection of Employment) Regulations 2006, or

(d) if P holds office or is employed in a company which is an associated company (as defined in paragraph 35(4)) of the scheme organiser, that company ceasing to be an associated company of the scheme organiser by reason of a change of control (as determined in accordance with sections 450 and 451 of CTA 2010),]

the options may only be exercised within 6 months after the termination date.

(3) In a case where P ceases to hold the scheme-related employment for any other reason, share options granted more than 3 years before the termination date either—

(a) may not be exercised, or

(b) may only be exercised within 6 months after the termination date,

according to which of these alternatives is specified in the scheme.

(4) Subject to any provision made under sub-paragraph (5), in a case where P ceases to hold the scheme-related employment for any reason other than one within sub-paragraph (2)(a) [F38 to (d)], share options granted 3 years or less before the termination date may not be exercised at all.

(5) The scheme may [F39 make provision about the time when the options may be exercised] in a case where P ceases to hold the scheme-related employment only because—

(a) it is in a company of which the scheme organiser ceases to have control, or

(b) it relates to a business or part of a business which is transferred to a person who is not an associated company of the scheme organiser.

F40 ...

[F41 (5A) If the scheme makes provision by virtue of sub-paragraph (5), the provision must be either—

(a) that the options may be exercised within 6 months after the termination date, or

(b) that the options may be exercised within 6 months after the date (if any) when P ceases to hold the employment which (before the termination date) was the scheme-related employment for a reason within sub-paragraph (2)(a) [F42 to (d)].]

(6) This paragraph has effect subject to paragraph 30(1)(b) (options must not be capable of being exercised later than 6 months after bonus date).

(7) In this paragraph—

• “scheme-related employment” means the office or employment by reference to which the person satisfies the condition in paragraph 10(1) (“the employment requirement”);

• “the termination date” means the date when P ceases to hold the scheme-related employment (see paragraph 35).

Textual Amendments

F34 Words in Sch. 3 para. 34(2)(a) inserted (10.7.2003) by Finance Act 2003 (c. 14), Sch. 21 para. 11(2)

F35 Word in Sch. 3 para. 34(2) omitted (17.7.2013) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 23(2)(a) (with Sch. 2 para. 23(4))

F36 Words in Sch. 3 para. 34(2)(b) omitted (17.7.2013) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 12 (with Sch. 2 para. 17)

F37 Sch. 3 para. 34(2)(c)(d) inserted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 2 para. 23(2)(b) (with Sch. 2 para. 23(4))

F38 Words in Sch. 3 para. 34(4) substituted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 2 para. 23(3) (with Sch. 2 para. 23(4))

F39 Words in Sch. 3 para. 34(5) substituted (10.7.2003) by Finance Act 2003 (c. 14), Sch. 21 para. 11(3)(a)

F40 Words in Sch. 3 para. 34(5) repealed (10.7.2003) by Finance Act 2003 (c. 14), Sch. 21 para. 11(3)(b), Sch. 43 Pt. 3(3)

F41 Sch. 3 para. 34(5A) inserted (10.7.2003) by Finance Act 2003 (c. 14), Sch. 21 para. 11(4)

F42 Words in Sch. 3 para. 34(5A)(b) substituted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 2 para. 23(3) (with Sch. 2 para. 23(4))

Time when scheme-related employment ends U.K.

35 (1) This paragraph applies for the purposes of paragraph 34 (exercise of options: scheme-related employment ends). U.K.

(2) Unless sub-paragraph (3) applies, a participant (“P”) is to be regarded as ceasing to hold scheme-related employment on the date when the office or employment in question terminates.

(3) If—

(a) P’s scheme-related employment terminates, but

(b) P continues to hold an office or employment in the scheme organiser or any associated company,

P is to be regarded as ceasing to hold the scheme-related employment on the date when P no longer holds any office or employment within paragraph (b), and not at any earlier time.

(4) For the purposes of sub-paragraph (3) one company is an “associated company” of another company if—

(a) one has control of the other, or

(b) both are under the control of the same person or persons;

and for this purpose the question of whether a person controls a company is to be determined in accordance with [F43 sections 450 and 451 of CTA 2010] (“control” in the context of close companies).

(5) Nothing in paragraph 34 or this paragraph applies where a person’s scheme-related employment terminates on that person’s death (see instead paragraph 32).

(6) In this paragraph “scheme-related employment” has the same meaning as in paragraph 34.

Textual Amendments

F43 Words in Sch. 3 para. 35(4) substituted (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 397(4) (with Sch. 2)

Exercise of options: employment in associated company at bonus date U.K.

36 U.K. The scheme may provide that if at the bonus date a participant holds an office or employment in a company which is—

(a) an associated company of the scheme organiser, but

(b) not a constituent company,

the options may be exercised within 6 months after that date.

Exercise of options: company events U.K.

37 (1) The scheme may provide that share options relating to shares in a company may be exercised within 6 months after the relevant date for the purposes of sub-paragraph (2), (4) or (5). U.K.

(2) The relevant date for the purposes of this sub-paragraph is the date when—

(a) a person has obtained control of the company as a result of making an offer falling within sub-paragraph (3), and

(b) any condition subject to which the offer is made has been satisfied.

(3) An offer falls within this sub-paragraph if it is—

(a) a general offer to acquire the whole of the issued ordinary share capital of the company, which is made on a condition such that, if it is met, the person making the offer will have control of the company, or

(b) a general offer to acquire all the shares in the company which are of the same class as the shares in question obtained under the scheme.

[F44 (3A) In sub-paragraph (3)(a) the reference to the issued ordinary share capital of the company does not include any capital already held by the person making the offer or a person connected with that person and in sub-paragraph (3)(b) the reference to the shares in the company does not include any shares already held by the person making the offer or a person connected with that person.

(3B) For the purposes of sub-paragraph (3)(a) and (b) it does not matter if the general offer is made to different shareholders by different means.]

(4) The relevant date for the purposes of this sub-paragraph is the date when the court sanctions under [F45 section 899 of the Companies Act 2006 (court sanction for compromise or arrangement)] a compromise or arrangement [F46 applicable to or affecting—

(a) all the ordinary share capital of the company or all the shares of the same class as the shares to which the option relates, or

(b) all the shares, or all the shares of that same class, which are held by a class of shareholders identified otherwise than by reference to their employment or directorships or their participation in an approved SAYE option scheme.]

(5) The relevant date for the purposes of this sub-paragraph is the date when the company passes a resolution for voluntary winding up.

(6) The scheme may provide that share options relating to shares in a company may be exercised at any time when any person is bound or entitled to acquire shares in the company under [F47 sections 979 to 982 [F48 or 983 to 985] of the Companies Act 2006 (takeover offers: right of offeror to buy out minority shareholder [F49 etc] )].

(7) For the purposes of this paragraph—

(a) “share options” means share options granted under the scheme; and

(b) a person is to be treated as obtaining control of a company if that person and others acting in concert together obtain control of it.

(8) This paragraph has effect subject to paragraph 30(1)(b) (options must not be capable of being exercised later than 6 months after bonus date).

Textual Amendments

F44 Sch. 3 para. 37(3A)(3B) inserted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 2 para. 24(2) (with Sch. 2 para. 24(3))

F45 Words in Sch. 3 para. 37(4) substituted for Sch. 3 para. 37(4)(a)(b) (6.4.2008) by The Companies Act 2006 (Consequential Amendments) (Taxes and National Insurance) Order 2008 (S.I. 2008/954), arts. 1(1), 32(2) (with art. 4)

F46 Words in Sch. 3 para. 37(4) substituted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 2 para. 24(4) (with Sch. 2 para. 24(5))

F47 Words in Sch. 3 para. 37(6) substituted for Sch. 3 para. 37(6)(a)(b) (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), Sch. 3 para. 3 (with art. 11(1))

F48 Words in Sch. 3 para. 37(6) inserted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 2 para. 24(6)(a) (with Sch. 2 para. 24(7))

F49 Word in Sch. 3 para. 37(6) inserted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 2 para. 24(6)(b) (with Sch. 2 para. 24(7))

Part 7 U.K. Exchange of share options

Exchange of options on company reorganisation U.K.

38 (1) An SAYE option scheme may provide that if— U.K.

(a) there is a company reorganisation affecting a scheme company (that is, a company whose shares may be acquired by the exercise of share options obtained under the scheme: see paragraph 18), and

(b) a participant has obtained share options under the scheme which are to acquire shares of the scheme company (“the old options”),

the participant may agree with the acquiring company to release the old options in consideration of the participant being granted new share options.

(2) For the purposes of this paragraph there is a company reorganisation affecting a scheme company if another company (“the acquiring company”)—

(a) obtains control of the scheme company—

(i) as a result of making a general offer to acquire the whole of the issued ordinary share capital of the scheme company which is made on a condition such that, if it is met, the person making the offer will have control of that company, or

(ii) as a result of making a general offer to acquire all the shares in the scheme company which are of the same class as those subject to the old options;

[F50 (b) obtains control of the scheme company as a result of a compromise or arrangement sanctioned by the court under section 899 of the Companies Act 2006 (court sanction for compromise or arrangement); or

(c) becomes bound or entitled to acquire shares in the scheme company under sections 979 to 982 [F51 or 983 to 985] of that Act (takeover offers: right of offeror to buy out minority shareholder [F52 etc] ).]

[F53 (2A) In sub-paragraph (2)(a)(i) the reference to the issued ordinary share capital of the scheme company does not include any capital already held by the person making the offer or a person connected with that person and in sub-paragraph (2)(a)(ii) the reference to the shares in the scheme company does not include any shares already held by the person making the offer or a person connected with that person.

(2B) For the purposes of sub-paragraph (2)(a)(i) and (ii) it does not matter if the general offer is made to different shareholders by different means.]

(3) A scheme that makes provision under sub-paragraph (1) must require the agreement referred to in that sub-paragraph to be made—

(a) where control is obtained in the way set out in sub-paragraph (2)(a)(i) or (ii), within the period of 6 months beginning with the time when the acquiring company obtains control and any condition subject to which the offer is made is met,

(b) where control is obtained in the way set out in sub-paragraph (2)(b), within the period of 6 months beginning with the time when the court sanctions the compromise or arrangement, and

(c) where sub-paragraph (2)(c) applies, within the period during which the acquiring company remains bound or entitled as mentioned in that provision.

Textual Amendments

F50 Sch. 3 para. 38(2)(b)(c) substituted (6.4.2008) by The Companies Act 2006 (Consequential Amendments) (Taxes and National Insurance) Order 2008 (S.I. 2008/954), arts. 1(1), 32(3) (with art. 4)

F51 Words in Sch. 3 para. 38(2)(c) inserted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 2 para. 25(2)(a) (with Sch. 2 para. 25(4))

F52 Word in Sch. 3 para. 38(2)(c) inserted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 2 para. 25(2)(b) (with Sch. 2 para. 25(4))

F53 Sch. 3 para. 38(2A)(2B) inserted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 2 para. 25(3) (with Sch. 2 para. 25(4))

Requirements about share options granted in exchange U.K.

39 (1) This paragraph applies to a scheme that makes provision under paragraph 38 (exchange of options on company reorganisation). U.K.

(2) The scheme must require the new share options to relate to shares in a company which—

(a) is different from the company whose shares are subject to the old options, and

(b) is either the acquiring company itself or some other company within sub-paragraph (b) or (c) of paragraph 18 (shares must be ordinary shares of certain companies), namely—

(i) a company which has control of the scheme organiser, or

(ii) a company which is, or has control of a company which is, a member of a consortium owning either the scheme organiser or a company having control of the scheme organiser.

For this purpose the control in question may be through the medium of the acquiring company.

(3) The scheme must also require the new share options to be equivalent to the old options.

(4) For the new options to be regarded as equivalent to the old options—

(a) the shares to which they relate must meet the conditions in paragraphs 18 to 22 (types of share that may be used),

(b) they must be exercisable in the same manner as the old options and subject to the provisions of the scheme as it had effect immediately before the release of the old options,

(c) the total market value of the shares subject to the old options immediately before the release of those options by the participant must equal the total market value, immediately after the grant of the new options to the participant, of the shares subject to those options, and

(d) the total amount payable by the participant for the acquisition of shares under the new options must be equal to the total amount that would have been so payable under the old options.

(5) For the purposes of the SAYE code, new share options granted under the terms of a provision included in a scheme under paragraph 38 are to be treated as having been granted at the time when the corresponding old options were granted.

(6) This also applies for the purposes of the provisions of the scheme in their operation, after the grant of the new options, by virtue of a condition complying with sub-paragraph (4)(b).

[F54 (7) For the purposes of this paragraph the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.]

Textual Amendments

F54 Sch. 3 para. 39(7) inserted (with effect in accordance with Sch. 2 para. 67 of the amending Act) by Finance Act 2013 (c. 29), Sch. 2 para. 63

Part 8 U.K. Approval of schemes

Application for approval U.K.

40 (1) Where— U.K.

(a) an SAYE option scheme has been established, and

(b) the scheme organiser makes an application to [F1 an officer of Revenue and Customs] for approval of the scheme,

[F1 an officer of Revenue and Customs] must approve the scheme if [F55 the officer] [F56 is] satisfied that it meets the requirements of Parts 2 to 7 of this Schedule.

(2) An application for approval—

(a) must be in writing, and

(b) must contain such particulars and be supported by such evidence as [F1 an officer of Revenue and Customs] may require.

(3) Once [F1 an officer of Revenue and Customs] [F57 has] decided whether or not to approve the scheme, [F58 the officer] must give notice of [F59 the] decision to the scheme organiser.

Textual Amendments

F1 Words in Act substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 102(1); S.I. 2005/1126, art. 2(2)(h)

F55 Words in Sch. 3 para. 40(1) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(1)(n); S.I. 2005/1126, art. 2(2)(h)

F56 Word in Sch. 3 para. 40(1) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 122(a)(i); S.I. 2005/1126, art. 2(2)(h)

F57 Word in Sch. 3 para. 40(3) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 122(a)(ii); S.I. 2005/1126, art. 2(2)(h)

F58 Words in Sch. 3 para. 40(3) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(1)(n); S.I. 2005/1126, art. 2(2)(h)

F59 Words in Sch. 3 para. 40(3) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(3)(d); S.I. 2005/1126, art. 2(2)(h)

Appeal against refusal of approval U.K.

41 (1) If [F1 an officer of Revenue and Customs] [F60 refuses] to approve the scheme, the scheme organiser may appeal F61 .... U.K.

(2) The notice of appeal must be given to [F1 an officer of Revenue and Customs ] within 30 days after the date on which notice of [F62 the officer's] decision was given to the scheme organiser.

(3) [F63 If the appeal is notified to and allowed by the tribunal, the tribunal may direct] [F1 an officer of Revenue and Customs] to approve the scheme with effect from a date specified by the [F64 tribunal].

(4) The date so specified must not be earlier than that of the application for approval.

Textual Amendments

F1 Words in Act substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 102(1); S.I. 2005/1126, art. 2(2)(h)

F60 Word in Sch. 3 para. 41(1) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 122(b); S.I. 2005/1126, art. 2(2)(h)

F61 Words in Sch. 3 para. 41(1) omitted (1.4.2009) by virtue of The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 1 para. 345(2)

F62 Words in Sch. 3 para. 41(2) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(2)(d); S.I. 2005/1126, art. 2(2)(h)

F63 Words in Sch. 3 para. 41(3) substituted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 1 para. 345(3)(a)

F64 Word in Sch. 3 para. 41(3) substituted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 1 para. 345(3)(b)

Withdrawal of approval U.K.

42 (1) If any disqualifying event occurs in connection with an approved SAYE option scheme, [F1 an officer of Revenue and Customs] may by a notice given to the scheme organiser withdraw the approval with effect from— U.K.

(a) the time at which the disqualifying event occurred, or

(b) a later time specified by [F1 an officer of Revenue and Customs] in the notice.

(2) A “disqualifying event” occurs in connection with a scheme if—

(a) any of the requirements of Parts 2 to 7 of this Schedule ceases to be met;

[F65 (aa) an alteration is made in a key feature of the scheme without the approval of [F1 an officer of Revenue and Customs];] or

(b) the scheme organiser fails to provide information requested by [F1 an officer of Revenue and Customs] under paragraph 45.

[F66 (2A) For the purposes of sub-paragraph (2)(aa) [F1 an officer of Revenue and Customs] may not withhold F67 ... approval unless it appears to [F68 the officer] at the time in question that the scheme as proposed to be altered would not then be approved on an application under paragraph 40.

(2B) For the purposes of that sub-paragraph a “key feature” of a scheme is a provision of the scheme which is necessary in order to meet the requirements of this Schedule.]

(3) If share options granted under an SAYE option scheme before the withdrawal of approval under this paragraph are exercised after the withdrawal, the scheme is to be treated for the purposes of—

(a) section 519 (exemption in respect of exercise of share option), and

[F69 (b) section 421G(b) (exemption from Chapters 2 to 4 of Part 7),]

in their application to such options, as if it were still approved at the time of the exercise.

Textual Amendments

F1 Words in Act substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 102(1); S.I. 2005/1126, art. 2(2)(h)

F65 Sch. 3 para. 42(2)(aa) inserted (10.7.2003) by Finance Act 2003 (c. 14), Sch. 21 para. 12(2)

F66 Sch. 3 para. 42(2A)(2B) inserted (10.7.2003) by Finance Act 2003 (c. 14), Sch. 21 para. 12(3)

F67 Word in Sch. 3 para. 42(2A) repealed (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(4)(b), Sch. 5; S.I. 2005/1126, art. 2(2)(h)(i)

F68 Words in Sch. 3 para. 42(2A) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(1)(o); S.I. 2005/1126, art. 2(2)(h)

F69 Sch. 3 para. 42(3)(b) substituted (with effect in accordance with Sch. 22 para. 44(2) of the amending Act) by Finance Act 2003 (c. 14), Sch. 22 para. 44(1)

[F70 Notice of decision about alteration U.K.

Textual Amendments

F70 Sch. 3 para. 43 and crossheading substituted (10.7.2003) by Finance Act 2003 (c. 14), Sch. 21 para. 12(4)

43 U.K. Where [F1 an officer of Revenue and Customs] —

(a) [F71 has] been requested to approve any alteration in a SAYE option scheme that has been approved, and

(b) [F71 has] decided whether or not to approve the alteration,

[F72 the officer] must give notice of [F73 the] decision to the scheme organiser.]

Textual Amendments

F1 Words in Act substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 102(1); S.I. 2005/1126, art. 2(2)(h)

F71 Word in Sch. 3 para. 43 substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 122(c); S.I. 2005/1126, art. 2(2)(h)

F72 Words in Sch. 3 para. 43 substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(1)(p); S.I. 2005/1126, art. 2(2)(h)

F73 Words in Sch. 3 para. 43 substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(3)(e); S.I. 2005/1126, art. 2(2)(h)

Appeal against withdrawal of approval etc. U.K.

44 (1) This paragraph applies if an SAYE option scheme has been approved by [F1 an officer of Revenue and Customs] and [F74 the officer] — U.K.

(a) [F75 decides] to withdraw approval of the scheme under paragraph 42, or

[F76 (b) [F75 decides] to refuse approval under paragraph 42(2)(aa).]

(2) The scheme organiser may appeal against the decision F77 ....

(3) The notice of appeal must be given to [F1 an officer of Revenue and Customs] within 30 days after the date on which notice of [F78 the officer's] decision was given to the scheme organiser.

Textual Amendments

F1 Words in Act substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 102(1); S.I. 2005/1126, art. 2(2)(h)

F74 Words in Sch. 3 para. 44(1) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(1)(q); S.I. 2005/1126, art. 2(2)(h)

F75 Word in Sch. 3 para. 44(1) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 122(d); S.I. 2005/1126, art. 2(2)(h)

F76 Sch. 3 para. 44(1)(b) substituted (10.7.2003) by Finance Act 2003 (c. 14), Sch. 21 para. 12(5)

F77 Words in Sch. 3 para. 44(2) omitted (1.4.2009) by virtue of The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 1 para. 346

F78 Words in Sch. 3 para. 44(3) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(2)(e); S.I. 2005/1126, art. 2(2)(h)

Part 9 U.K. Supplementary provisions

Power to require information U.K.

45 (1) [F1 An officer of Revenue and Customs] may by notice require any person to provide [F79 the officer] with any information— U.K.

(a) which [F79 the officer] reasonably [F80 requires] for the performance of [F81 the officer's] functions under the SAYE code, and

(b) which the person to whom the notice is addressed has or can reasonably obtain.

(2) The power conferred by this paragraph extends, in particular, to—

(a) information to enable [F1 an officer of Revenue and Customs] —

(i) to decide whether to approve an SAYE option scheme or to withdraw an approval already given, or

(ii) to determine the liability to tax, including capital gains tax, of any person who has participated in a scheme, and

(b) information about the administration of a scheme and any alteration of the terms of a scheme.

(3) The notice must require the information to be provided within a specified time, which must not end earlier than 3 months after the date when the notice is given.

Textual Amendments

F1 Words in Act substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 102(1); S.I. 2005/1126, art. 2(2)(h)

F79 Words in Sch. 3 para. 45(1) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(1)(r); S.I. 2005/1126, art. 2(2)(h)

F80 Word in Sch. 3 para. 45(1) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 122(e); S.I. 2005/1126, art. 2(2)(h)

F81 Words in Sch. 3 para. 45(1) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(2)(f); S.I. 2005/1126, art. 2(2)(h)

Jointly owned companies U.K.

46 (1) This paragraph applies for the purposes of the provisions of the SAYE code relating to group schemes. U.K.

(2) Each joint owner of a jointly owned company is to be treated as controlling every company within sub-paragraph (3).

(3) The companies within this sub-paragraph are—

(a) the jointly owned company, and

(b) any company controlled by that company.

(4) However, no company within sub-paragraph (3) may be—

(a) a constituent company in more than one group scheme, or

(b) a constituent company in a particular group scheme if another company within that sub-paragraph is a constituent company in a different group scheme.

(5) In this paragraph a “jointly owned company” means a company which (apart from sub-paragraph (2)) is not controlled by any one person and—

(a) of which 50% of the issued share capital is owned by one person and 50% by another, or

(b) which is otherwise controlled by two persons taken together.

(6) In this paragraph “joint owner” means one of the persons mentioned in sub-paragraph (5)(a) or (b).

Meaning of “associated company” U.K.

47 (1) For the purposes of the SAYE code, except in paragraph 35(3) (time when “scheme-related employment” ends), one company is an “associated company” of another company at a given time if, at that time or at any other time within one year previously— U.K.

(a) one has control of the other, or

(b) both are under the control of the same person or persons.

(2) For the purposes of sub-paragraph (1) the question whether a person controls a company is to be determined in accordance with [F82 sections 450 and 451 of CTA 2010].

Textual Amendments

F82 Words in Sch. 3 para. 47(2) substituted (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 397(5) (with Sch. 2)

Minor definitions U.K.

48 (1) In the SAYE code— U.K.

• “ [F83 certified SAYE savings arrangement] ” has the meaning given in [F84 section 703(1) of ITTOIA 2005];

• “company” means a body corporate;

• “market value” has the same meaning as it has for the purposes of TCGA 1992 by virtue of Part 8 of that Act.

(2) For the purposes of the SAYE code a company is a member of a consortium owning another company if it is one of a number of companies—

(a) which between them beneficially own not less than 75% of the other company’s ordinary share capital, and

(b) each of which beneficially owns not less than 5% of that capital.

[F85 (3) For the purposes of the SAYE code—

(a) shares are subject to a “restriction” if there is any contract, agreement, arrangement or condition which makes provision to which any of subsections (2) to (4) of section 423 (restricted securities) would apply if the references in those subsections to the employment-related securities were to the shares, and

(b) the “restriction” is that provision.]

Textual Amendments

F83 Words in Sch. 3 para. 48(1) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(11)(a) (with Sch. 2)

F84 Words in Sch. 3 para. 48(1) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(11)(b) (with Sch. 2)

F85 Sch. 3 para. 48(3) inserted (with effect in accordance with Sch. 2 para. 67 of the amending Act) by Finance Act 2013 (c. 29), Sch. 2 para. 65

Index of defined expressions U.K.

49 U.K. In the SAYE code the following expressions are defined or otherwise explained by the provisions indicated below:

approved	section 516(4) (and see paragraph 42(3))
associated company	paragraph 47(1)
the bonus date	paragraph 30(3)
[F86 certified SAYE savings arrangement]	paragraph 48(1)
child	[F87 section 721(6)]
close company	[F88 section 989 of ITA 2007] F89 ...
company	paragraph 48(1)
connected person	section 718
constituent company	paragraph 3(3)
control	section 719 (and see paragraphs 35(4) and 47(2))
distribution	[F90 section 989 of ITA 2007]
earnings	section 62 and see section 721(7)
eligible shares (in Part 4 of this Schedule)	paragraph 17(2)
employee and employment	section 4
group scheme	paragraph 3(2) (and see paragraph 46)
F91 . . .	F91 . . .
F92 . . .	F92 . . .
market value	paragraph 48(1)
member of a consortium	paragraph 48(2)
notice	[F93 section 989 of ITA 2007]
the options (in relation to a participant)	paragraph 2(2)
ordinary share capital	[F94 section 989 of ITA 2007]
participant	paragraph 2(2)
participate	paragraph 2(2)
personal representatives	[F95 section 989 of ITA 2007]
recognised stock exchange	[F96 section 1005 of ITA 2007]
[F97 restriction (in relation to shares)	paragraph 48(3)]
the SAYE code	section 516(3)
SAYE option scheme	section 516(4)
the scheme organiser	paragraph 2(2)
share option	section 516(4)
shares	section 516(4)
F98 . . .	F98 . . .
F99 . . .	paragraph 31
tax	[F100 section 989 of ITA 2007]
[F101 tribunal	section 989 of ITA 2007]
F102 . . .	F102 . . .

Textual Amendments

F86 Words in Sch. 3 para. 49 substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 618(12) (with Sch. 2)

F87 Words in Sch. 3 para. 49 Table substituted (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 1 para. 448(a) (with Sch. 2)

F88 Words in Sch. 3 para. 49 Table substituted (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 1 para. 448(b) (with Sch. 2)

F89 Words in Sch. 3 para. 49 Table omitted (with effect in accordance with Sch. 2 para. 43 of the amending Act) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 42

F90 Words in Sch. 3 para. 49 Table substituted (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 1 para. 448(c) (with Sch. 2)

F91 Sch. 3 para. 49 entry repealed (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 122(f), Sch. 5; S.I. 2005/1126, art. 2(2)(h)(i)

F92 Sch. 3 para. 49 Table entry repealed (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 1 para. 448(d), Sch. 3 Pt. 1 (with Sch. 2)

F93 Words in Sch. 3 para. 49 Table substituted (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 1 para. 448(e) (with Sch. 2)

F94 Words in Sch. 3 para. 49 Table substituted (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 1 para. 448(f) (with Sch. 2)

F95 Words in Sch. 3 para. 49 Table substituted (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 1 para. 448(g) (with Sch. 2)

F96 Words in Sch. 3 para. 49 Table substituted (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 1 para. 448(h) (with Sch. 2)

F97 Words in Sch. 3 para. 49 Table inserted (with effect in accordance with Sch. 2 para. 67 of the amending Act) by Finance Act 2013 (c. 29), Sch. 2 para. 66

F98 Words in Sch. 3 para. 49 Table omitted (1.4.2009) by virtue of The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 1 para. 347(2)

F99 Words in Sch. 3 para. 49 Table omitted (17.7.2013) by virtue of Finance Act 2013 (c. 29), Sch. 2 para. 13 (with Sch. 2 paras. 16, 17)

F100 Words in Sch. 3 para. 49 Table substituted (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 397(6) (with Sch. 2)

F101 Words in Sch. 3 para. 49 Table inserted (1.4.2009) by The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 1 para. 347(3)

F102 Sch. 3 para. 49 Table entry repealed (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 1 para. 448(j), Sch. 3 Pt. 1 (with Sch. 2)