- Latest available (Revised)
- Original (As enacted)
Income Tax (Earnings and Pensions) Act 2003, Section 702 is up to date with all changes known to be in force on or before 27 August 2024. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations.
Revised legislation carried on this site may not be fully up to date. Changes and effects are recorded by our editorial team in lists which can be found in the ‘Changes to Legislation’ area. Where those effects have yet to be applied to the text of the legislation by the editorial team they are also listed alongside the legislation in the affected provisions. Use the ‘more’ link to open the changes and effects relevant to the provision you are viewing.
Whole provisions yet to be inserted into this Act (including any effects on those provisions):
(1)In this Chapter “readily convertible asset” means—
(a)an asset capable of being sold or otherwise realised on—
(i)a recognised investment exchange (within the meaning of the Financial Services and Markets Act 2000 (c. 8)),
(ii)the London Bullion Market,
(iii)the New York Stock Exchange, or
(iv)a market for the time being specified in PAYE regulations;
(b)an asset consisting in—
(i)the rights of an assignee, or any other rights, in respect of a money debt that is or may become due to the employer or any other person,
(ii)property that is subject to a warehousing regime, or any right in respect of property so subject, or
(iii)anything that is likely (without anything being done by the employee) to give rise to, or to become, a right enabling a person to obtain an amount or total amount of money which is likely to be similar to the expense incurred in the provision of the asset; or
(c)an asset for which trading arrangements are in existence, or are likely to come into existence in accordance with—
(i)any arrangements of another description existing when the asset is provided, or
(ii)any understanding existing at that time.
(2)For the purposes of this section trading arrangements for any asset provided to any person exist whenever there exist any arrangements the effect of which in relation to that asset is to enable—
(a)that person, or
(b)a member of that person’s family or household,
to obtain an amount or total amount of money that is, or is likely to be, similar to the expense incurred in the provision of that asset.
(3)PAYE regulations may exclude any description of arrangements from being trading arrangements for the purposes of this section.
(4)References in this section to enabling a person to obtain an amount of money are to be read—
(a)as references to enabling an amount to be obtained by that person by any means at all, including in particular—
(i)by using any asset or other property as security for a loan or advance, or
(ii)by using any rights comprised in or attached to any asset or other property to obtain any asset for which trading arrangements exist; and
(b)as including references to cases where a person is enabled to obtain an amount as a member of a class or description of persons, as well as where the person is so enabled in the person’s own right.
(5)For the purposes of this section an amount is similar to the expense incurred in the provision of any asset if it is, or is an amount of money equivalent to—
(a)the amount of the expense so incurred, or
(b)a greater amount, or
(c)an amount that is less than that amount but not substantially so.
[F1(5A)An asset consisting in securities which is not a readily convertible asset apart from this subsection is to be treated as a readily convertible asset unless the securities are shares that are corporation tax deductible.
(5B)For the purposes of subsection (5A) shares are corporation tax deductible if they are acquired by a person—
(a)by reason of that, or another person's, employment with a company, or
(b)pursuant to an option granted by reason of that, or another person's, employment with a company,
and the company is entitled to corporation tax relief in respect of the shares under [F2Part 12 of CTA 2009] (corporation tax relief for employee share acquisition).
(5C)If a person acquires additional shares by virtue of holding shares that are corporation tax deductible, the additional shares are to be treated for the purposes of subsection (5A) as if they were corporation tax deductible.
(5D)If—
(a)on a person ceasing to be beneficially entitled to shares that are corporation tax deductible, that person acquires other shares, and
(b)the circumstances are such that the shares to which the person ceases to be beneficially entitled constitute “original shares” and the other shares constitute a “new holding” for the purposes of sections 127 to 130 of TCGA 1992,
the shares that constitute the new holding are to be treated for the purposes of subsection (5A) as if they were corporation tax deductible.]
(6)In this section—
“money” includes money expressed in a currency other than sterling;
“money debt” means any obligation which falls to be, or may be, settled—
by the payment of money, or
by the transfer of a right to settlement under an obligation which is itself a money debt;
[F3"securities" has the same meaning as in Chapters 1 to 5 of Part 7 (employment income from securities) (see section 420),
“shares” includes—
an interest in shares, and
stock or an interest in stock,]
“warehousing regime” means—
a warehousing or fiscal warehousing regime (within the meaning of sections 18 to 18F of the Value Added Tax Act 1994 (c. 23)); or
any corresponding arrangements in a State other than the United Kingdom which is a Contracting Party to the Agreement on the European Economic Area signed at Oporto on 2nd May 1992 as adjusted by the Protocol signed at Brussels on 17th March 1993.
Textual Amendments
F1S. 702(5A)-(5D) inserted (10.7.2003) by Finance Act 2003 (c. 14), Sch. 22 para. 15(2)
F2Words in s. 702(5B) substituted (with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), s. 1329(1), Sch. 1 para. 555 (with Sch. 2 Pts. 1, 2)
F3Words in s. 702(6) inserted (10.7.2003) by Finance Act 2003 (c. 14), Sch. 22 para. 15(3)
Modifications etc. (not altering text)
C1S. 702 modified (10.7.2003) by Finance Act 2003 (c. 14), Sch. 22 para. 15(4)
C2S. 702 modified (17.12.2020 for specified purposes, 31.12.2020 in so far as not already in force) by 1994 c. 23, Sch. 9ZB para. 26(3) (as inserted by Taxation (Post-transition Period) Act 2020 (c. 26), s. 11(1)(e), Sch. 2 para. 2 (with s. 3(4), Sch. 2 para. 7(7)-(10)); S.I. 2020/1642, reg. 9)
The Whole Act you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
The Whole Act you have selected contains over 200 provisions and might take some time to download.
Would you like to continue?
The Whole Act without Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
The Whole Act without Schedules you have selected contains over 200 provisions and might take some time to download.
Would you like to continue?
The Whole Act you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
The Whole Act without Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
The Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
Latest Available (revised):The latest available updated version of the legislation incorporating changes made by subsequent legislation and applied by our editorial team. Changes we have not yet applied to the text, can be found in the ‘Changes to Legislation’ area.
Original (As Enacted or Made): The original version of the legislation as it stood when it was enacted or made. No changes have been applied to the text.
Geographical Extent: Indicates the geographical area that this provision applies to. For further information see ‘Frequently Asked Questions’.
Show Timeline of Changes: See how this legislation has or could change over time. Turning this feature on will show extra navigation options to go to these specific points in time. Return to the latest available version by using the controls above in the What Version box.
Text created by the government department responsible for the subject matter of the Act to explain what the Act sets out to achieve and to make the Act accessible to readers who are not legally qualified. Explanatory Notes were introduced in 1999 and accompany all Public Acts except Appropriation, Consolidated Fund, Finance and Consolidation Acts.
Access essential accompanying documents and information for this legislation item from this tab. Dependent on the legislation item being viewed this may include:
This timeline shows the different points in time where a change occurred. The dates will coincide with the earliest date on which the change (e.g an insertion, a repeal or a substitution) that was applied came into force. The first date in the timeline will usually be the earliest date when the provision came into force. In some cases the first date is 01/02/1991 (or for Northern Ireland legislation 01/01/2006). This date is our basedate. No versions before this date are available. For further information see the Editorial Practice Guide and Glossary under Help.
Use this menu to access essential accompanying documents and information for this legislation item. Dependent on the legislation item being viewed this may include:
Click 'View More' or select 'More Resources' tab for additional information including: