Explanatory Note
(This note is not part of the Regulations)
Assessable income provided to employees in the form of tradeable assets is paid under the operation of PAYE.
These Regulations make an amendment to regulation 3 of the Income Tax (Employments) (Notional Payments) Regulations 1994 (S.I. 1994/1212) which excludes from the operation of PAYE tradeable assets provided to employees in the form of shares in an employer company or in a company controlling an employer company (“own company shares”).
The amendment limits the exclusion to the following cases — first, cases where own company shares are acquired, or an option or an interest in such shares is obtained or acquired, under a share option scheme or a profit sharing scheme approved by the Board of Inland Revenue under Schedule 9 to the Income and Corporation Taxes Act 1988; and secondly, cases where own company shares are acquired as a result of the exercise of a right over shares obtained before the date of coming into force of these Regulations otherwise than under a scheme approved by the Board under that Schedule.