Income Tax (Earnings and Pensions) Act 2003

447 Application of this Chapter

(1) This Chapter applies where a person (“the employee”)—

(a) acquires shares or an interest in shares in a company, and

(b) does so as a director or employee of that or another company.

(2) In this Chapter (unless the context indicates a different meaning)—

• “the acquisition” means the acquisition of shares or an interest in shares mentioned in subsection (1)(a);

• “the shares” means the shares mentioned there;

and “director” and “employee” have the extended meaning given by section 470(1).

(3) The company as a director or employee of which the employee acquires the shares or the interest in them is “the employer company” for the purposes of this Chapter.

(4) For the purposes of this Chapter a person (“E”) acquires shares or an interest in shares “as a director or employee” of a company if E acquires the shares or interest in pursuance of—

(a) a right conferred on, or an opportunity offered to, E by reason of E’s office as a director of, or E’s employment by, the company; or

(b) a right assigned to E after having been conferred on some other person by reason of E’s office as a director of, or E’s employment by, the company.

(5) In addition, if a person (“A”) acquires shares or an interest in shares in a company in pursuance of a right conferred on, or opportunity offered to, A as a person connected with a director or employee of that or another company (“the company”), the director or employee is to be treated for the purposes of this Chapter—

(a) as acquiring the shares or interest “as a director or employee” of the company, and

(b) as holding any beneficial interest in the shares for the time being held by A;

and subsections (1) to (3) apply accordingly.

(6) Section 463 provides for a person to be treated as continuing to have a beneficial interest in shares until there is a qualifying disposal for the purposes of that section.