Income Tax (Earnings and Pensions) Act 2003 Schedule 2 paragraph 8

All-employee nature of plan

Schedule 2 paragraph 8 sets out the requirement that a Share Incentive Plan (SIP) must be open to all eligible employees on an equal basis, ensuring the plan is genuinely "all-employee" in nature.

• All eligible employees who are UK resident taxpayers must be invited to participate in every share award under the plan — no one meeting the criteria can be excluded.
• The plan must not contain any feature that discourages any category of eligible employee from participating, unless that feature is specifically required or permitted by the SIP legislation itself.
• Employees who meet the eligibility requirements but are not UK resident taxpayers may optionally be included in the plan and invited to participate, at the company's discretion.
• A "qualifying employee" for SIP purposes is either a UK resident taxpayer who is automatically eligible, or a non-UK-resident employee who has been made eligible under the plan and has been invited to participate.