Income Tax (Earnings and Pensions) Act 2003 section 516

SAYE option schemes

Section 516 introduces the framework for Save As You Earn (SAYE) option schemes, setting out the scope of the chapter, defining the "SAYE code", and providing key definitions used throughout the scheme rules.

• The chapter provides income tax exemptions for share options granted under SAYE option schemes that qualify as Schedule 3 SAYE option schemes.
• The "SAYE code" is the collective name for the rules in this chapter, Schedule 3, and Part 2 of Schedule 7D to TCGA 1992 (which deals with capital gains tax aspects when options are exercised).
• An SAYE option scheme is a company-established scheme that grants share options to employees and directors, where the shares are paid for through a linked approved savings arrangement.
• Key definitions include "share option" (a right to acquire shares in a company) and "shares" (which includes stock), with further defined terms indexed at the end of Schedule 3.