A share incentive plan ('SIP') provides for shares to be awarded to or acquired by employees of a company by reason of their employment. The shares are held for a specified minimum period by trustees on behalf of the employees. A plan must be self-certified by the employer as a 'Schedule 2 SIP' which meets the necessary conditions, described in E4.528–E4.5421.
The costs described below can be deducted as trading expenses2 (or, in the case of an investment company or insurance company, as expenses of management3).
Cost of setting up the plan
A deduction is allowed for expenditure by a company on setting up a SIP which is self-certified as a 'Schedule 2 SIP'4. The deduction is given for the period of account in which the expenditure is incurred if the relevant date falls within nine months after the end of that period; otherwise it is given for the period of account in which the relevant date falls5. The relevant date is the date the self-certification declaration is made
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Web page updated on 17 Mar 2025 16:20