CSOP: THE COMPANY SHARE OWNERSHIP PLAN

In brief the CSOP is a tax favoured discretionary option plan under which a company may grant options to any employee or full-time director to acquire shares at an exercise price which must be not less than the market value of the shares on the grant date. The market value of the share over which options are granted must not exceed £30,000 at the date the options are granted.

Generally if the option is exercised more than three years after the grant date the exercise does not trigger a tax charge and the gains are taxed under the CGT regime on the sale of the shares.