Income Tax (Earnings and Pensions) Act 2003 section 36

Exercise of options: employment in associated company at bonus date

Section 36 deals with the right to exercise share options where, at the bonus date, the participant is employed by an associated company of the scheme organiser that is not itself a constituent company of the scheme.

• The SAYE share option scheme may include a provision covering participants who, at the bonus date, are employed by an associated company of the scheme organiser
• This provision applies only where that associated company is not a constituent company within the scheme
• In such circumstances, the participant may exercise their share options within 6 months after the bonus date
• This ensures that participants are not disadvantaged simply because their employer, while associated with the scheme organiser, does not participate directly in the scheme