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HMRC internal manual

Business Income Manual

From
HM Revenue & Customs
Updated
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Specific deductions: employee share schemes: summary of tax and NICs treatment

This table summarises the key features of the different kinds of approved and unapproved schemes, and the tax and NICs treatment for employers and employees.

Scheme SIP EMI CSOP SAYE Unapproved
           
Options or awards? Awards Options Options Options Options or awards
Must a trust be used? Yes Not essential Not essential Not essential Not essential
Income tax advantages for employees? Yes Yes Yes Yes No
NICs advantages for employees and employers? Yes Yes Yes Yes No
Statutory tax deductions for employers’ setting up costs? Yes No - general trade profits principles apply Yes Yes No - general trade profits principles apply
Statutory deductions for employers’ contributions to trusts? Yes Yes Yes Yes Only if ‘qualifying shares’, - otherwise general trade profits principles apply (including the employee benefit trust rules)