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HMRC internal manual

Employee Tax Advantaged Share Scheme User Manual

Schedule 4 Company Share Option Plan (CSOP): Shares to be used: Introduction

Paragraph 15 imposes requirements on which shares can be used in Schedule 4 CSOP schemes.

The relevant requirements concerning the shares which can be used (‘scheme shares’) are then set out in paragraphs 16-20 of Schedule 4.

The legislation aims to ensure that the scheme shares which participants will acquire under a Schedule 4 CSOP scheme are:

  • normal shares on normal terms (paragraphs 18, 19* and 20),
  • in a company:


  • with which their employment can be identified (paragraph 16), and
  • that offers little scope for manipulating the value of the shares (paragraph 17).

  • Paragraph 19 was repealed by Schedule 2 to the Finance Act 2013 in relation to share options granted on or after 17 July 2013.