Company Share Option Plan

Published: 24 Oct 2015

 

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Employees and full time directors can be granted share options in their employer’s company.  The exercise price cannot be less than the market value of the shares at the date of granting, and no more than £30,000 worth of share options can be granted to each participant.  The scheme is open only to employees and full time directors.  Shares cannot be exercised less than three years or more than ten years after the date on which they are granted.

 

There is no tax or national insurance payable on any increase in value between the date on which the shares are granted and the date on which they are exercised.

 

The options do not have to be made available to all employees.  However, any person with more than a 25% interest in the company cannot participate.

 

The tax legislation for Company Share Option Plans is in Schedule 4 of the Income Tax (Earnings and Pensions) Act 2003

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