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HMRC internal manual

Employee Tax Advantaged Share Scheme User Manual

HM Revenue & Customs
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Schedule 3 SAYE option schemes: Requirements relating to share options – The exercise price: Process of granting options

Schedule 3 SAYE option schemes provide for options to be granted by means of an invitation to the employees to make applications which are then accepted by the company. In Schedule 3 SAYE option schemes the process of companies granting options unilaterally is generally unsatisfactory, given the administration involved with the need for linked savings contracts. 

Under an invitation and application procedure the legal right to the shares is obtained when the company accepts the employee’s application. The company can therefore arrange to accept all applications on the same day, so that all employees obtain their rights at the same time, and based on the same market value. Options under Schedule 3 SAYE option schemes are not normally granted under seal or for monetary consideration. The consideration, necessary to ensure a binding contractual right, is the undertaking given by the employee to enter into a savings contract.