The following Corporate guidance note provides comprehensive and up to date legal information covering:
Various income tax and national insurance contributions (NICs) charges can arise for an employee or director in relation to the acquisition, ownership or disposal of employment-related securities. Associated PAYE and NICs obligations can also arise for the employing company.
A security (which includes shares, debt, derivatives and interests in investment partnerships) will be an employment-related security where the right or opportunity to acquire the securities (or interest in securities) is:
available by reason of an employment of the person acquiring the securities (or interest) or any other person, or
made available by a person's employer (or a person connected with a person's employer) (the deeming provision) unless such right or opportunity is made available:
by an individual, and
in the normal course of the domestic, family or personal relationships of that individual
For these purposes, employment includes a former, current and prospective employment.
The rules on employment-related securities apply very broadly because of the deeming provision. It means that the employment-related securities rules must be considered whenever shares are acquired in the employing company or a connected company.
For more details, see Practice Note: What is an employment-related security?.
Where an employee or director acquires shares by virtue of his employment for free or for less than market value, an
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