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Company Share Option Plans

There are a number of government approved share schemes which offer tax advantages to employees. One of these schemes is known as the Company Share Option Plans (CSOP). Under a CSOP, employees do not pay Income Tax or NICs provided the qualifying conditions are met. This applies to a qualifying option to buy up to £30,000 worth of shares at a fixed price. However, there may be a CGT liability when the shares are eventually sold.

The rules state you will not be chargeable to Income Tax if you exercise your options at a time when the CSOP scheme remains tax-advantaged and:

The exercise of an option in all other circumstances will be chargeable to Income Tax.

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