Income Tax (Earnings and Pensions) Act 2003 section Schedule 5 paragraph 46

Notice of enquiry

Schedule 5 paragraph 46 sets out the rules governing when and how HMRC may open an enquiry into a share option that has been notified under an Enterprise Management Incentives (EMI) scheme.

• Once a share option has been notified to HMRC, an officer may enquire into the option by giving formal notice to the employer company, or may separately enquire into whether the individual option holder meets the working time commitment requirement by giving notice to that individual
• A notice of enquiry must normally be given no later than 12 months after the deadline by which the original share option notification was required to be submitted
• There is no time limit for opening an enquiry if HMRC discovers that any information provided in or in connection with the original share option notification was false or misleading in a material respect
• An option that has already been the subject of an enquiry cannot be enquired into again under the same provision, unless the further enquiry is triggered by the discovery of false or misleading information