C1Part 7F1Employment income: income and exemptions relating to securities
Pt. 7: power to modify conferred (7.4.2005) by Finance Act 2005 (c. 7), s. 21(8)-(10)
Chapter 9Enterprise management incentives
Tax advantages where disqualifying events
532Modified tax consequences following disqualifying events
1
This section applies where—
a
a disqualifying event (see section 533) occurs in relation to a qualifying option before the option is exercised, and
b
the option is exercised later than F390 days after the day on which the event occurred.
2
If the option is within section 530(1) (option to acquire shares at market value), the section 476 gain is—
(see subsection (4)).
3
If the option is within section 531(1) (option to acquire shares at less than market value), the section 476 gain is—
(see subsection (4)).
4
For the purposes of subsections (2) and (3)—
ACO is the amount or value of the consideration given for the grant of the option,
ACS is the amount, if any, for which the shares are acquired,
CMV is the chargeable market value (as defined by section 531(3)), and
PEG is the post-event gain, that is the amount (if any) by which the market value of the shares at the time when the option is exercised exceeds their market value immediately before the disqualifying event.
F44A
Sections 226B to 226D (deemed payment for acquisition of employee shareholder shares) provide for the determination of the amount, if any, for which employee shareholder shares (within the meaning of section 226A(6)) are acquired.
5
6
Nothing in the following provisions—
a
subsections (2) and (3) above, or
b
sections 530 and 531,
applies if the amount that counts as employment income by virtue of section 476 in respect of the exercise of the option would, in the absence of those provisions, be less than the amount that counts as such income as a result of those provisions.
Pt. 7 heading substituted (with effect in accordance with Sch. 22 para. 2(2) of the amending Act) by Finance Act 2003 (c. 14), Sch. 22 para. 2(1)