Income Tax (Earnings and Pensions) Act 2003 Schedule 5 paragraph 49

Effect of enquiry

Schedule 5 paragraph 49 explains the consequences of HMRC choosing to open, or not open, an enquiry into whether an Enterprise Management Incentives (EMI) share option meets the qualifying requirements.

• If HMRC does not issue a notice of enquiry, the option is automatically treated as meeting all the requirements of Schedule 5.
• If HMRC does open an enquiry, the officer's decision in the closure notice is conclusive as to whether the option meets the Schedule 5 requirements.
• A decision that requirements are not met can be overturned on appeal, and a decision that requirements are met can be revisited if HMRC later discovers false or misleading information.
• These enquiry provisions do not affect the rules on disqualifying events set out in sections 532 to 539 of the Act.