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HMRC internal manual

Employee Tax Advantaged Share Scheme User Manual

HM Revenue & Customs
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Schedule 4 Company Share Option Plan (CSOP): Eligibility of individuals to participate: The employment requirement: Self employed consultants

Options cannot be granted under Schedule 4 CSOP schemes in respect of services rendered in a self-employed capacity - for example to self-employed insurance salesmen.

A director may, in addition to holding that office, act as a consultant to the company. To be a full-time director eligible to participate in a Schedule 4 CSOP scheme his services rendered in his capacity as director of the company must:

  • be in return for remuneration from which tax is deductible under PAYE,
  • satisfy the 25 hours per week “full-time” eligibility condition excluding any hours worked as a consultant, and
  • exceed in terms of hours worked the time spent providing services as a consultant (for which he receives fees chargeable under Part 2 ITTOIA 2005).