Income Tax (Earnings and Pensions) Act 2003 Schedule 5 paragraph 30

Material interest: options and interests in SIPs

Paragraph 30 explains how share options and SIP trust holdings are treated when determining whether an individual has a material interest (broadly, more than 30% of a company's ordinary share capital) for the purposes of the SAYE option scheme rules.

• A right to acquire shares, however it arises, is treated as a right to control those shares — but shares obtainable under a qualifying SAYE option are ignored until actually acquired
• Where unexercised rights would, if exercised, oblige the company to issue new shares, the company's ordinary share capital is notionally increased by those unissued shares when testing the 30% threshold
• The shares counted against an individual include those attributable to the individual's associates, as required by the material interest rules
• Shares held by the trustees of a Schedule 2 SIP that have not yet been appropriated to, or acquired on behalf of, any individual — and any trustee rights arising from that holding — are disregarded entirely