Employment income provided through third parties: exclusions: earmarking for employee share and share option schemes: 'exercise' of options
Sections 554L to 554N and 554Z7 ITEPA 2003
Part 7A ITEPA 2003 refers in various places to an option being ‘exercised’ or ‘exercisable’.
These terms respectively cover cases in which the option holder actively does (or can) exercise the option.
But they are not limited to such cases.
They also cover cases in which the option holder does not necessarily have to take any action in order to exercise the option.
For example, ‘exercise’ could involve the automatic receipt of shares or cash at the end of a vesting period.