Income Tax (Earnings and Pensions) Act 2003 section 527

Enterprise management incentives: qualifying options

Section 527 introduces the Enterprise Management Incentives (EMI) scheme and defines the key terms used throughout the EMI code, including what makes a share option a "qualifying option".

• The EMI code provides income tax exemptions and reliefs for qualifying share options that have been properly notified to HMRC
• A qualifying option must meet the requirements set out in Schedule 5 at the time the option is granted and must be notified to HMRC under Part 7 of that Schedule
• The EMI code is made up of this chapter's provisions together with Schedule 5
• Key definitions include "share option" (a right to acquire shares in a company) and "replacement option" (an option granted in connection with a company reorganisation)