Income Tax (Earnings and Pensions) Act 2003 section 50

Application of money deducted where no accumulation periods

Section 50 sets out how partnership share money must be applied when the share incentive plan does not include an accumulation period, including the timing of share acquisition and the treatment of any surplus funds.

• Where there is no accumulation period, trustees must use partnership share money to buy shares for the employee on a designated acquisition date set no later than 30 days after the final deduction
• The number of shares each employee receives is based on the market value of the shares on the acquisition date
• Any surplus partnership share money left after purchasing shares may, with the employee's agreement, be carried forward and added to the next deduction
• If the employee does not agree to carry forward the surplus, it must be paid back to the employee as soon as practicable