ETASSUM34120 - Schedule 3 SAYE option schemes: Linkage to savings (arrangement): Deductions from pay

The Prospectus requires that the monthly contributions should normally be made through deductions from pay. The following exceptions have been allowed:

  • Where the employer is a clearing bank and every employee has a current account with the bank, contributions may be made by standing order,
  • If employees are paid weekly, monthly contributions may be made out of a ‘feeder account’ for each employee (see ETASSUM34110),
  • If an employee is on maternity leave,
  • If an employee is on parental or adoption leave,
  • If an employee is a reservist called up for military service,
  • If an employee is on long-term sick leave,
  • If an employee is on secondment,
  • If an employee moves from a company to an associated company which is not in the UK and which is unable to operate the required payroll processes,
  • If an employee is on sabbatical leave, or

  • After cessation of employment the participant will normally be allowed to continue making monthly contributions direct to the savings body:

  • either for a period of up to six months to accumulate extra savings with which to exercise an option during that period,
  • or for the remainder of the 36 (or 60) months to the maturity of the savings contract, if the ex-employee is unable or chooses not to exercise his or her share option.

In addition to the above, if participants who find themselves unable to make monthly contributions from their salary, due to having to take unpaid leave during the coronavirus pandemic, HMRC will permit payments to be made via standing order. Deductions from salary should recommence at the earliest opportunity.

If a person dies before he has completed the payment of 36 (or 60) monthly contributions, no further contributions can be made under his savings contract.