36 |
16A.7 Approved SAYE Option Schemes ITEPA, Part 7 Chapter 7, Sections 516–520 |
Since 1980 it has been possible to combine an approved share option scheme with an approved savings scheme so as to take advantage of the tax efficiency of the savings scheme to provide the funds to finance the exercise of the option.142 Inland Revenue Statistics 1999, Table 6.2 shows that, by the end of 1997–1998, 1,834 schemes had been approved; the initial market value of shares over which options had been granted over those years totalled £19.2 bn; in 1997–1998 the average value per employee of the shares over which options had been granted was £2,500; the cost of the tax relief in those years was £450 m. |
16A.7.1 Conditions of Approval |
16A.7.1.1 The Scheme |
The savings scheme must be within TA 1988, section 326 and be approved by the Revenue for this purpose.143 The contribution must not exceed £250 a month.144 The option is not normally exercisable for 5 or 7 years (ie the period needed to attract the bonus on maturity of the savings scheme) and the price for the shares must not exceed the proceeds of the contract. |
16A.7.1.2 Who may Participate? |
The participants in the scheme, ie those eligible to participate, must include all UK resident and ordinarily resident employees (whether full time or part time) or full-time directors with, |