C1Part 7F1Employment income: income and exemptions relating to securities
Pt. 7: power to modify conferred (7.4.2005) by Finance Act 2005 (c. 7), s. 21(8)-(10)
Chapter 7Approved SAYE option schemes
Tax advantages
519No charge in respect of exercise of option
1
No liability to income tax arises in respect of the exercise of the share option if—
a
the individual exercises it in accordance with the provisions of the SAYE option scheme at a time when the scheme is approved, F4...
b
condition A or B is met F3and
c
the avoidance of tax or national insurance contributions is not the main purpose (or one of the main purposes) of any arrangements under which the option was granted or is exercised.
2
Condition A is that the option is exercised on or after the third anniversary of the date on which it was granted.
3
Condition B is that the option—
a
is exercised before the third anniversary of the date on which it was granted, and
b
is so exercised otherwise than by virtue of a provision included in the scheme under—
paragraph 34(5) of Schedule 3 (exercise of option where scheme-related employment ends), or
paragraph 37 of that Schedule (exercise of option where certain company events occur).
F24
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5
In Schedule 3—
a
paragraph 32 provides for the exercise of an option where the holder has died, and
b
paragraph 42(3) provides for an SAYE option scheme to be treated as approved at the time when an option is exercised even though approval of the scheme has been previously withdrawn.
Pt. 7 heading substituted (with effect in accordance with Sch. 22 para. 2(2) of the amending Act) by Finance Act 2003 (c. 14), Sch. 22 para. 2(1)