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HMRC internal manual

Employee Tax Advantaged Share Scheme User Manual

Schedule 3 SAYE option schemes: Linkage to Savings (Arrangement): Employees' declaration

The Prospectus requires employees, when applying to enter into new savings contracts (linked to new share options), to make a declaration that they will not, by entering into the new savings contract, exceed the £500 per month aggregate maximum savings limit under Schedule 3 SAYE savings arrangements. Generally a savings contract is “entered into” when the savings body accepts the employee’s application to participate, however there may be other factors to consider in determining the date a contract is entered into and in the first instance this will be a matter for the company and its advisers (ETASSUM34100).

The terms of the declaration under each prospectus:

  • are concerned with the aggregate of contributions which would be paid monthly by the employee, regardless of whether the savings contracts under which the contributions are made overlap each other;
  • contain a space for inserting the earliest date on which the first payment under the new contract will be made, enabling the employee to make clear the extent (if any) to which, in any month, there will overlapping payments under the overlapping existing and the new savings contracts;
  • enable employees with existing savings contracts which are soon to mature, to make applications to enter into new savings contracts (linked to new options) which will allow them to take full advantage, if they wish, of the aggregate monthly savings limit  (currently £500) in paragraph 25.

There is no objection to the earliest date for the first payment being pre-printed or entered in advance by the savings body or the company, so that all applicants under a new tranche of options will have a common date before which monthly payments will not start.