Income Tax (Earnings and Pensions) Act 2003

Share options U.K.

62 U.K. The following provisions have effect in relation to rights obtained before 6th April 1998 with the substitution of “seventh anniversary” for “tenth anniversary”—

(a) section 474(1) (no charge in respect of receipt of shorter-term option), and

(b) section 475(1) (value of longer-term option for purposes of liability to tax in respect of receipt).

63 (1) This paragraph relates to the operation of section 473 (share options to which Chapter 5 of Part 7 does not apply). U.K.

(2) Section 473(1) applies in relation to a share option granted before 6th April 2003 with the substitution of “if the person was not chargeable under Case I of Schedule E in respect of the office or employment” for the words from “if the earnings” onwards.

64 (1) This paragraph relates to the operation of section 478 (amount of charges) in relation to a share option obtained before 6th April 2003. U.K.

(2) For the purposes of section 478(1), any amount charged to tax under Schedule E in respect of the receipt of the share option is a deductible amount.

65 (1) This paragraph relates to the operation of section 479 (amount of gain realised by exercising option) in relation to a share option obtained before 6th April 2003. U.K.

(2) For the purposes of section 479(1), if an amount was chargeable to tax under section 185(6) of ICTA (charge where option under approved share option scheme granted at a discount) in respect of the share option, so much of that amount as is attributable to the shares in question is a deductible cost.

66 (1) This paragraph relates to the operation of section 480 (amount of gain realised by assigning or releasing option) in relation to a share option obtained before 6th April 2003. U.K.

(2) For the purposes of section 480(1), if an amount was chargeable to tax under section 185(6) of ICTA (charge where option under approved share option scheme granted at a discount) in respect of the share option, so much of that amount as is attributable to the shares in question is a deductible cost.

67 (1) This paragraph applies where in the tax year 2002-03 a company— U.K.

(a) granted a share option in respect of which tax might have become chargeable under section 135 of ICTA,

(b) allotted or transferred shares on the exercise of such a share option,

(c) received notice of the assignment of such a share option, or

(d) provided a benefit in money or money’s worth—

(i) for the assignment of such a share option,

(ii) for the release in whole or in part of such a share option,

(iii) for or in connection with a failure, or undertaking not, to exercise such a share option, or

(iv) for or in connection with the grant of, or an undertaking to grant, a right to acquire shares or an interest in shares to which such a share option relates.

(2) Section 486 (duty to notify matters relating to share options) applies in relation to the matter subject to the following provisions.

(3) The particulars required by section 486(2) must be provided to the Inland Revenue before 7th July 2003.

(4) However, no particulars of the provision need be provided by a company under section 486 if the company has already given particulars of it under—

(a) section 136(6) of ICTA (which made provision corresponding to section 486 for tax years before 2003-04), or

(b) paragraph 2 of Schedule 14 to FA 2000 (which made provision corresponding to paragraph 44 of Schedule 5 for tax years before 2003-04).