Income Tax (Earnings and Pensions) Act 2003 section 18A

Participation in more than one connected SIP in a tax year

Section 18A requires that where an employee participates in share awards under more than one connected Share Incentive Plan (SIP) in the same tax year, the annual limits on free shares, partnership share deductions and dividend reinvestment are applied as if all the connected plans were a single plan.

• An employee may participate in share awards under multiple SIPs run by the same company or a connected company within the same tax year
• The maximum annual award of free shares (paragraph 35) applies across all connected plans combined, not separately to each plan
• The maximum amount of partnership share money deductions (paragraph 46) and the limit on dividend reinvestment (paragraph 64) are likewise aggregated across all connected plans
• A "connected company" has the same meaning as defined in paragraph 18 of Schedule 2