Income Tax (Earnings and Pensions) Act 2003 section 49

Partnership share money held for employee

Section 49 sets out the rules for how partnership share money deducted from an employee's salary must be handled by the plan trustees before it is used to buy shares.

• Partnership share money deducted under a partnership share agreement must be paid to the plan trustees as soon as practicable and held on the employee's behalf until used to acquire partnership shares.
• The requirement to hold the money for the employee is subject to certain circumstances where the money must instead be returned to the employee, as set out in paragraphs 50 and 52.
• The trustees must keep any partnership share money in an account — whether interest-bearing or not — held with an authorised deposit-taking institution, a building society, or an EEA firm permitted to accept deposits.
• If the money is held in an interest-bearing account, the trustees must account to the employee for any interest earned on that money.