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HMRC internal manual

Employee Tax Advantaged Share Scheme User Manual

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HM Revenue & Customs
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Schedule 4 Company Share Option Plan (CSOP): Eligibility of individuals to participate: The "no material interest" requirement: Material interest overview

Paragraph 9 contains the main “material interest” provisions. It aims to prohibit anyone who already has a substantial interest in a company extending it by means of tax-relieved share options under Schedule 4 CSOP schemes, the grant of which the person concerned may be able to influence. 

A Schedule 4 CSOP scheme must provide that an individual is not eligible to participate in the scheme on any date if that individual has on that date:

Scheme rules for option schemes should ensure that they apply the paragraph 9 prohibition both at the time an option is granted and at the time an option is exercised.