Commentary

E1.417 Dividends under share incentive plans—general

Personal and employment tax

E1.417 Dividends under share incentive plans—general

Dividends under share incentive plans

E1.417 Dividends under share incentive plans—general

In general terms, a Schedule 2 share incentive plan ('SIP') allows special tax exemptions or deferral of tax liability to an employee who acquires shares in his employing company if certain conditions are satisfied. These conditions are fully described in E4.528–E4.542.

This article is concerned with the taxation treatment of dividends on shares issued under the plan.

These rules apply if either of the following conditions was met at the time the shares were awarded:

  1.  

    •     the employee was assessed under ITEPA 2003, ss 3–61 (Pt 2) in respect of

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