Employee shareholder agreements

326BAdvice relating to proposed employee shareholder agreements

1

No liability to income tax arises by virtue of—

a

the provision of relevant advice by a relevant independent adviser, or

b

the payment or reimbursement, in accordance with section 205A(7) of the Employment Rights Act 1996, of any reasonable costs incurred in obtaining relevant advice.

2

“Relevant advice” means—

a

advice, other than tax advice, which is provided for the purposes of section 205A(6)(a) of that Act (advice as to terms and effect of employee shareholder agreement), and

b

tax advice which is so provided and consists only of an explanation of the tax effects of employee shareholder agreements generally.

3

In this section—

• “employee shareholder agreement” means an agreement by virtue of which an employee is an employee shareholder (see section 205A(1)(a) to (d) of that Act);

• “relevant independent adviser” has the meaning that it has for the purposes of section 203(3)(c) of that Act.