Determining whether shares are held as employment-related securities is not always straightforward. David Pett (Temple Tax Chambers) takes a closer look.
Although it is easy to identify when a share has been acquired by reason of employment or office (see ITEPA 2003 s 5) the definition of an ‘employment-related security’ (ERS) for the purposes of the charges to income tax imposed by ITEPA 2003 Part 7 Chapters 2–4A is broader in scope than many appreciate. It is not however as broad as HMRC has on occasion asserted it to be. The purpose of this article is to identify what is and what is not an ERS. Whilst I refer below to ‘shares’ the points made apply equally to other forms of ‘security’ as defined in ITEPA 2003 s 420. All statutory references are to ITEPA 2003 unless stated otherwise.
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Determining whether shares are held as employment-related securities is not always straightforward. David Pett (Temple Tax Chambers) takes a closer look.
Although it is easy to identify when a share has been acquired by reason of employment or office (see ITEPA 2003 s 5) the definition of an ‘employment-related security’ (ERS) for the purposes of the charges to income tax imposed by ITEPA 2003 Part 7 Chapters 2–4A is broader in scope than many appreciate. It is not however as broad as HMRC has on occasion asserted it to be. The purpose of this article is to identify what is and what is not an ERS. Whilst I refer below to ‘shares’ the points made apply equally to other forms of ‘security’ as defined in ITEPA 2003 s 420. All statutory references are to ITEPA 2003 unless stated otherwise.
To put...
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