Part 7Employment income: share-related income and exemptions
Chapter 5Share options
Introduction
472Introduction to taxation of share options
1
The starting-point is that liability to tax may arise by virtue of Chapter 1 of Part 3 (earnings) or Chapter 10 of that Part (taxable benefits: residual liability to charge) when the share option is received, but not when it is exercised.
2
But section 474 (no charge in respect of receipt of shorter-term option) contains an exemption from this liability.
3
Liability to tax may arise when the share option is exercised by virtue of—
a
Chapter 8 of Part 3 (taxable benefits: notional loans in respect of acquisitions of shares), or
b
section 476 or 477 (charge on exercise etc. of option).
4
Liability to tax may also arise when the share option is assigned or released by virtue of section 476 or 477.
5
There are special rules relating to share options received under—
a
approved SAYE option schemes (see Chapter 7 of this Part),
b
approved CSOP schemes (see Chapter 8 of this Part), or
c
enterprise management incentives (see Chapter 9 of this Part).