Income Tax (Earnings and Pensions) Act 2003 section Schedule 2 paragraph 23

Meaning of "associate": trustees of employee benefit trust

Schedule 2 paragraph 23 defines when trustees of an employee benefit trust are treated as "associates" of a participant in a Share Incentive Plan (SIP), which is relevant for determining whether the plan meets the qualifying conditions.

• Trustees of an employee benefit trust are treated as associates of a SIP participant if the participant, or certain persons connected with them, are among the beneficiaries of that trust.
• The connected persons whose beneficiary status can trigger the association include the participant themselves, their relatives, and the trustees of any settlement where the participant or their relatives are beneficiaries.
• A "relative" for this purpose means a spouse, civil partner, parent, child (including stepchild), or the spouse or civil partner of a child or stepchild.
• An "employee benefit trust" is any trust where the beneficiaries include current or former employees of the company (or a connected company), or their relatives or dependants.