Taxes Consolidation Act 1997 Schedule 11 paragraph 12

Eligibilty conditions for individual

Paragraph 12 of Schedule 11 sets out the eligibility requirement that an individual must be a current or recent employee or director of the relevant company before shares can be appropriated to him or her under a profit sharing scheme.

• An individual must be an employee or director of the company that established the scheme at the time shares are appropriated, or must have held such a position within the preceding 18 months.
• Where the scheme is a group scheme, the individual may instead be an employee or director of a participating company within the group.
• The 18-month window allows shares to be appropriated to individuals who have recently left employment, such as retirees or those made redundant.
• If the individual does not meet this eligibility condition, the scheme's trustees cannot appropriate shares to him or her.