Income Tax (Earnings and Pensions) Act 2003 section 61

Holding period for matching shares

Section 61 applies the same holding period rules that govern free shares to matching shares awarded under a Share Incentive Plan.

• Matching shares are subject to the same holding period requirements as free shares.
• The holding period can be set by the plan between three and five years, during which employees must generally retain their shares.
• If an employee leaves the plan before the holding period ends, the treatment of the matching shares follows the same rules as for free shares, including possible forfeiture provisions.
• This alignment ensures a consistent approach to how long employees must hold both free and matching shares before they can be freely withdrawn from the plan.