(1)This section applies where a chargeable event (within the meaning of section 69 below) occurs in relation to the trustees of an employee share ownership trust.
(2)In such a case—
(a)the trustees shall be treated as receiving, when the event occurs, annual profits or gains whose amount is equal to the chargeable amount (within the meaning of section 70 below),
(b)the profits or gains shall be chargeable to tax under Case VI of Schedule D for the year of assessment in which the event occurs, and
(c)the rate at which the tax is chargeable shall be [F1the rate applicable to trusts] for the year of assessment in which the event occurs.
(3)If the whole or any part of the tax assessed on the trustees is not paid before the expiry of the period of six months beginning with the day on which the assessment becomes final and conclusive, a notice of liability to tax under this subsection may be served on a qualifying company and the tax or the part unpaid (as the case may be) shall be payable by the company on service of the notice.
(4)Where a notice of liability is served under subsection (3) above—
(a)any interest which is due on the tax or the part (as the case may be) and has not been paid by the trustees, and
(b)any interest accruing due on the tax or the part (as the case may be)after the date of service,
shall be payable by the company.
(5)Where a notice of liability is served under subsection (3) above and any amount payable by the company (whether on account of tax or interest) is not paid by the company before the expiry of the period of three months beginning with the date of service, the amount unpaid may be recovered from the trustees(without prejudice to the right to recover it instead from the company).
(6)For the purposes of this section each of the following is a qualifying company—
(a)the company which established the employee share ownership trust;
(b)any company falling within subsection (7) below.
(7)A company falls within this subsection if, before it is sought to serve a notice of liability on it under subsection (3) above—
(a)it has paid a sum to the trustees, and
(b)the sum has been deducted as mentioned in section 67(2)(a) above or treated as mentioned in section 67(2)(b) above.
Textual Amendments
F1Words in s. 68(2)(c) substituted (27.7.1993 with effect for the year 1993-94 and subsequent years of assessment) by 1993 c. 34, s. 79, Sch. 6 paras.20, 25(1)
Modifications etc. (not altering text)
C1 See Finance Act 1990 (c. 29) ss.31–40—.roll-over relief for disposal of assets to employee share ownership trusts