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Legislation
Income Tax (Earnings and Pensions) Act 2003

Crossheading Tax charge on post-acquisition chargeable events

  • Section 438 Charge on occurrence of chargeable event
  • Section 439 Chargeable events
  • Section 440 Amount of charge
  • Section 441 Amount of gain realised on occurrence of chargeable event
  • Section 442 Amount of consideration given for entitlement to convert
  • Section 442A Relief for secondary Class 1 contributions met by employee
  • Section 443 Case outside charge under section 438
  1. Tax charge on post-acquisition chargeable events
  2. Case outside charge under section 438

Section 443 | Case outside charge under section 438 F1

From legislation.gov.uk

(1)Section 438 (charge on occurrence of chargeable event) does not apply if—

(a)the employment-related securities are shares (or an interest in shares) in a company of a class,

(b)all the company’s shares of the class are convertible securities,

(ba)subsection (1A) is satisfied,F2

(c)all the company’s shares of the class (other than the employment-related securities) are affected by an event similar to that which is a chargeable event in relation to the employment-related securities, and

(d)subsection (3) or (4) is satisfied.

(1A)This subsection is satisfied unless something which affects the employment-related securities has been done (at or before the time when section 438 would apply) as part of a scheme or arrangement the main purpose (or one of the main purposes) of which is the avoidance of tax or national insurance contributions.F3

(2)For the purposes of subsection (1)(c) shares are affected by an event similar to that which is a chargeable event in relation to the employment-related securities—

(a)in the case of a chargeable event within section 439(3)(a) (conversion), if they are converted into securities of a different description,

(b)in the case of a chargeable event within section 439(3)(b) (disposal), if they are disposed of,

(c)in the case of a chargeable event within section 439(3)(c) (release of entitlement to convert), if the entitlement to convert them into securities of a different description is released, or

(d)in the case of a chargeable event within section 439(3)(d) (receipt of benefit), if a similar benefit is received in respect of the entitlement to convert them.

(3)This subsection is satisfied if, immediately before the event that would be a chargeable event, the company is employee-controlled by virtue of holdings of shares of the class.

(4)This subsection is satisfied if, immediately before that event, the majority of the company’s shares of the class are not employment-related securities.F4

(5)Repealed

Notes

  1. F1

    Pt. 7 Ch. 3 substituted (1.9.2003 with effect in accordance with Sch. 22 para. 4(2) of the amending Act) by Finance Act 2003 (c. 14), Sch. 22 para. 4(1); S.I. 2003/1997, art. 2

  2. F2

    S. 443(1)(ba) inserted (retrospective to 7.5.2004) by Finance Act 2004 (c. 12), ss. 86(2)(b)(3)(8), 86(1)

  3. F3

    S. 443(1A) substituted (with effect in accordance with Sch. 2 para. 11(2) of the amending Act) by Finance (No. 2) Act 2005 (c. 22), Sch. 2 para. 11(1)

  4. F4

    Words in s. 443(4) substituted (retrospective to 7.5.2004) by Finance Act 2004 (c. 12), ss. 86(2)(b)(5)(8), 86(1)

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