a right to acquire shares in a body corporate was obtained by any person in the period beginning with 6th April 1999 and ending with 19th May 2000 (“the original right”); and

the original right is or has been assigned or released (whether before or after the passing of this Act) for a consideration that consists of or includes another right (“the replacement right”) to acquire shares in that or any other body corporate.

as if (notwithstanding anything in F1F2section 483(1) to (4) of the Income Tax (Earnings and Pensions) Act 2003) the replacement right were or, as the case may be, were part of the valuable consideration given for the assignment or release; and

prevent a liability to pay Class 1 contributions from arising after the passing of this Act in respect of any gain realised on the exercise, assignment or release of the replacement right or of any subsequent replacement right, or

have the effect of deeming any such liability not to have arisen on any such gain,

as if that section had effect (or, as the case may be, had had effect) in relation to that right to the extent only that it is a right to acquire additional shares; and

as if the value of the consideration for the grant of the original right had been nil.

the whole or any part of any consideration given for the assignment or release of the replacement right or of any subsequent replacement right does not (or did not) comprise a subsequent replacement right, and

as a consequence, a gain would (but for this Act) be taken for the purposes of F7Chapter 5 of Part 7 of the Income Tax (Earnings and Pensions) Act 2003 to be realised (or to have been realised) on that assignment or release,

that (subject to paragraph (c)) the right assigned or released is a right the liability to pay Class 1 contributions in respect of which is a liability to which section 2(1)(a) or (b) applied;

that references in subsection (4) of this section to the original right and to the replacement right are references, respectively, to the right that is assigned or released and to the right comprised in the consideration for the assignment or release; and

that so much of the right assigned or released as is a right to acquire additional shares is to be disregarded for the purposes of both section 2(3) and subsection (4) of this section.

the amount which (in accordance with the provisions of F8section 479 of the Income Tax (Earnings and Pensions) Act 2003) would be taken to be the amount of the gain realised by an exercise of the new right at the relevant time (assuming it to be exercisable at that time) for obtaining the shares F9(less any deductible amounts under section 480(1) to (6)); and

the amount which would have been taken (in accordance with those provisions) to be the gain realised by a full exercise of the old right immediately before the time of its assignment or release;

all such repayments shall be made as may be necessary by virtue of that subsection; but

any amount which it would otherwise be necessary to repay in respect of a secondary Class 1 contribution paid by a person who has become liable to pay a special contribution under section 2 may be retained and set against any undischarged liability of his to pay that special contribution.