Part 7

Employment income: income and exemptions relating to securities
Chapter 11

Supplementary provisions about employee benefit trusts

Attribution of interests in company

Meaning of “appropriate percentage” for purposes of section 552
553
1
For the purposes of section 552 “the appropriate percentage” is—
(P × 100)/D
where P and D have the meaning given by the following provisions.
2
Unless subsection (3) applies, P is the aggregate of the relevant payment and any other payments received by B or associates of B’s from the trustees of the trust during the period of 12 months ending with the payment date.
3
If—
a
any distributions were made to the trustees of the trust by the company in respect of its ordinary share capital during the period of 3 years ending with the payment date, and
b
the aggregate of those distributions is less than the aggregate mentioned in subsection (2),
P is the aggregate of those distributions.
4
Unless subsection (5) applies, D is the amount determined as follows—
Step 1
Calculate the aggregate of—
a
any distributions made by the company in respect of its ordinary share capital during the period of 12 months ending with the payment date,
b
any distributions so made during the period of 12 months immediately preceding that mentioned in paragraph (a), and
c
any distributions so made during the period of 12 months immediately preceding that mentioned in paragraph (b).
Step 2
Divide the aggregate so calculated by the number of the periods mentioned in paragraphs (a) to (c) in which distributions were so made.
5
If no distributions were so made during any of those periods, D is 1.
6
In this section “the payment date” and “the relevant payment” have the meaning indicated in section 552(1).
Pt. 7: power to modify conferred (7.4.2005) by Finance Act 2005 (c. 7), s. 21(8)-(10)
Ss. 552-554 applied (6.4.2007) by Income Tax Act 2007 (c. 3), ss. 395(5), 1034(1) (with Sch. 2)
Pt. 7 heading substituted (with effect in accordance with Sch. 22 para. 2(2) of the amending Act) by Finance Act 2003 (c. 14), Sch. 22 para. 2(1)