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HMRC internal manual

Inheritance Tax Manual

From
HM Revenue & Customs
Updated
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Stocks and shares: Share Option Schemes: Pure Option Scheme

The employee, often in senior management, is granted an option to buy a specified number of shares at a price fixed when the option is granted. The employee pays nothing until he exercises his rights within the option period usually 3 - 7 years after its granting.

  • Accept that the difference between the date of death value and the cost of the option is the market value of the option at the date of death.
  • If the difference is a negative amount, limit the open market value to nil.
  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000)  
  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000)