Sharesave

Sharesave, also known as Save As You Earn, SAYE, or the Savings Related Share Option Scheme, is a British savings scheme designed to encourage employees to buy stakes in the companies for which they work. It was introduced by the British government in 1980, with HM Revenue & Customs approval, according to a model set by the Treasury. From 6 April 2014, HMRC approval will no longer be required for a SAYE plan to obtain tax benefits, instead an employer is required to self-certify that the SAYE meets the requirements of the relevant legislation. Accordingly, from 6 April 2014, a SAYE plan should no longer be referred to as an HMRC approved plan.

Mechanism

Under sharesave, a company offers its employees the right (known as the option) to buy shares in the company at a future date. The option may be granted at a discount of up to 20% of the current share price. The employee then chooses to save between £5 and £500 per month out of their net pay over a three or five-year term (prior to 6 April 2014, the maximum was £250 per month).