Taxes Consolidation Act 1997 Schedule 12A, paragraph 3

Conditions for approval

Paragraph 3 of Schedule 12A sets out the conditions Revenue must be satisfied with before approving a share option scheme, focusing on the exclusion of unnecessary features and the fair treatment of all eligible employees.

• Revenue must not approve a scheme containing features that are neither essential nor reasonably incidental to providing employees and directors with rights to acquire shares.
• The scheme must not contain features that discourage any class of eligible employee from participating.
• Where the company is part of a group, the scheme must not confer benefits wholly or mainly on directors or the highest-paid employees within that group.
• A group of companies includes any company the grantor controls or with which it is associated, determined by reference to common purpose, common control, or commonality of identity among those directing operations.