Income Tax (Earnings and Pensions) Act 2003 section 14

Time of eligibility to participate

Section 14 sets out the specific point in time at which an individual must be eligible in order to participate in an award of shares under a Share Incentive Plan (SIP).

• Eligibility must exist at a defined "appropriate time" which varies depending on the type of share award — free shares, partnership shares, or matching shares
• For free shares, the appropriate time is simply when the award is made; for partnership and matching shares, it is the time of the relevant deduction of partnership share money (or the first such deduction if there is an accumulation period)
• To be eligible, the individual must satisfy the plan's requirements regarding employment, not participating simultaneously in connected SIPs, and successive participation in connected SIPs
• Non-UK resident taxpayers face an additional hurdle: they must also meet any further eligibility requirements that the plan imposes beyond the standard criteria