Part 7F1Employment income: income and exemptions relating to securities
Chapter 11Supplementary provisions about employee benefit trusts
Employee benefit trusts
551“Qualifying disposals” for purposes of section 550
1
For the purposes of section 550 (meaning of “employee benefit trust”) a “qualifying disposal” is a disposal of property consisting of—
a
any of the ordinary share capital of the company, or
b
money paid outright,
where any of conditions 1, 2 and 3 is met.
2
Condition 1 is that the property has been applied for the benefit of—
a
individual employees or former employees of the company,
b
spouses, former spouses, widows or widowers of employees or former employees of the company,
c
dependants of persons within paragraph (a), or
d
relatives, or spouses of relatives, of persons within paragraph (a) or (b).
3
In subsection (2) each reference to the company includes a reference to a company controlled by the company.
4
Condition 2 is that the property has been applied for charitable purposes.
5
Condition 3 is that the property has been transferred to—
a
the trustees of another employee benefit trust,
b
the trustees of a qualifying employee share ownership trust (within the meaning of Schedule 5 to FA 1989), or
c
the trustees of a profit sharing scheme approved under Schedule 9 to ICTA (approved share option schemes and profit sharing schemes).
6
In this section “relative” means—
a
parent, child or remoter relation in the direct line, or
b
brother, sister, uncle, aunt, nephew or niece.
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)