HMRC internal manual

Employee Tax Advantaged Share Scheme User Manual

ETASSUM24780 - Schedule 2 share incentive plan (SIP): Types of award: Dividend shares: Paragraph 68: Amounts to be carried forward or repaid

Although the trustees must use the cash dividend to acquire dividend shares within 30 days of receiving it (see ETASSUM24760) there may be amounts of cash dividends that are not reinvested within this timeframe because the cash is insufficient to buy one share, or because some cash is left over after the acquisition. The trustees can pay these amounts over to the participants (see ETASSUM24790) or carry them forward to the next reinvestment (paragraph 68(2)). However, each sum must be clearly identifiable in the trust records, because this money must be paid to the participant as soon as practicable if:

If any of these events happen, the trustees must issue a voucher showing the amount paid, the date on which it was paid, and the amount of any tax credit applicable to that amount on that date.