Income Tax (Earnings and Pensions) Act 2003

Maximum amount of deductionsU.K.

46(1)The amount of partnership share money deducted from an employee’s salary must not exceed—U.K.

(a)£125 in any month, or

(b)where the salary is not paid at monthly intervals, such amount as bears to £125 the same proportion as the pay interval in question bears to one month.

(2)The amount of partnership share money deducted from an employee’s salary must not exceed 10% of the employee’s salary.

  • 10% of the employee’s salary” means—

    (a)

    if the plan does not provide for an accumulation period, 10% of the salary payment from which the deduction is made;

    (b)

    if the plan provides for an accumulation period, 10% of the total of the employee’s salary payments over that period.

(3)The plan may authorise the company to specify lower limits than those specified in sub-paragraphs (1) and (2).

(4)If it does so, different limits may be specified in relation to different awards of shares.

(5)Any amount deducted in excess of that allowed by sub-paragraph (1) or (2), or any lower limit in the plan, must be paid over to the employee as soon as practicable.