PT43a Share Scheme Quiz Flashcards
Who can participate in a SIP?
All employees (including parttime employees)
Can exclude if less than 18 months’ service
Similar terms for all employees. Can include performance criteria for free and matching
shares
Who can participate in a SAYE?
All employees (full-time
directors)
Can exclude if less than 5 years’ service
No performance criteria
Who can participate in a CSOP?
Selected full-time directors or full-time and part-time employees
Unequal terms – remunerate key members of staff
Who can participate in an EMI?
Selected full-time employees and directors (working at least
25 hours per week)
Unequal terms apply
What type of company is suitable for a SIP?
Normally ordinary
shares in a plc
What type of company is suitable for a SAYE?
Normally ordinary
shares in a plc
What type of company is suitable for a CSOP?
Normally ordinary
shares in a plc
What type of company is suitable for an EMI?
Normally ordinary
shares in an unquoted company
Conditions for a SIP
Free/matching shares must be subject to holding period of
between 3 years and 5 years (unless employment ceases)
Conditions for a SAYE
Employees save £5–£500 per month
3/5-year contracts
Price must be at least 80% of OMV at grant
Conditions for a CSOP
Max value at grant £30,000
No discount at grant
Conditions for an EMI
Max value at grant £250,000
(including CSOP £30,000)
Advantages of a SIP
Tax-efficient way of paying small bonuses
Benefit is tax free if withdrawn from plan after 5 years and sold immediately
BUT income tax charge if withdrawn early
CGT on Sales Proceeds less MV on withdrawal
Advantages of a SAYE
Only CGT on disposal
No tax until disposal
Advantages of a CSOP
Only CGT on disposal
Rewards key employees
But income tax charge on exercise if exercised outside 3–10 years from grant
