CSOP/SAYE/SIPs

This note sets out the legal, corporate governance and tax issues that arise for a company quoted on AIM operating share schemes for its employees.

There are a number of potential age discrimination issues for share schemes. This note concentrates on potential age discrimination caused by specifying a retirement age in the rules of an HMRC-approved company share option plan.

This note outlines the issues to consider when an employee holding share options or other share awards leaves the company for any reason or dies. The issues considered include: Determining whether the employee is actually treated as leaving under the rules of the relevant share plan. Determining the reason for leaving (for example, injury, ill-health, disability, redundancy, retirement, dismissal by the company or voluntary resignation). The effect of different leaver provisions in share plan rules, and the statutory leaver requirements for HMRC-approved share plans. Interaction with employment law and HR processes, such as drafting a compromise agreement, and considering whether the leaver may claim compensation for loss of rights under a share scheme. The tax and national insurance contributions ("NICs") implications of a share plan participant leaving the company or dying in service are dealt with in a separate note (see Practice note, Employee share schemes: tax and NICs issues for leavers).

A practice note on guidance on HMRC-approved SAYE option schemes contained in the new Employee Share Schemes User Manual published by HMRC.

This is a summary of some major cases relevant to share schemes in which the decision was published before February 2007 (roughly when PLC Share Schemes & Incentives began producing its own legal updates about cases).  Cases published from February 2007 are covered in separate legal updates which can be accessed from each share schemes topic page by clicking on the "Legal updates" tab.

This practice note considers the requirement that participating employees and/or their associates must not have a material interest in the company whose shares are used for tax-advantaged share incentives. It includes the special rules relating to employee benefit trusts and other discretionary trusts.

Lots of jargon and acronyms are used in share schemes and incentives practice, many of which are very similar.  These unfamiliar terms can make it difficult for newcomers  to quickly pick up on the basics of share schemes law and practice.  This jargon buster is intended to help those new to share schemes to navigate their way around the jargon and acronyms used by share schemes practitioners.

Fewer private than listed companies offer share incentives even though share plans can provide advantages for private companies. This note explains the share scheme issues specific to private companies and how they might be resolved.

A practice note explaining the mechanism for setting and changing the bonus and interest rates applicable to new savings contracts linked to HMRC-approved SAYE options.

This practice note is a consideration of the significance of the capital gains tax changes announced in the 2007 Pre-Budget Report for CSOP options, EMI options, SAYE options and share incentive plans, which took effect on 6 April 2008. As various different scenarios need to be considered, the note is, of necessity, reasonably detailed. The note considers the tax position up to 5 April 2010, when a new additional rate (50%) of income tax was introduced.

Companies need to know which employees must and may be permitted to participate in share schemes. Who can participate in a share scheme depends on the type of scheme in question. This practice note outlines the eligibility requirements for certain common types of share schemes.