Part 1Direct and indirect taxes

Employee shareholder shares

12Employee shareholder shares: amount treated as earnings

1

In section 226A of ITEPA 2003 (amount treated as earnings)—

a

in subsection (2), for “calculated in accordance with subsection (3)” substitute “ equal to the market value of the shares ”;

b

omit subsection (3);

c

in subsection (6), omit “and sections 226B to 226D”;

d

in subsection (7), after “subsection (1)” insert “ (but not subsection (2)) ”.

2

Omit sections 226B to 226D of ITEPA 2003 (deemed payment).

3

In consequence of subsection (2), in ITEPA 2003 omit the following—

a

section 479(3A);

b

section 531(3A);

c

section 532(4A).

4

In consequence of subsection (2), in CTA 2009 omit the following—

a

in section 1005, the definition of “employee shareholder share”;

b

section 1009(6);

c

in section 1010(1), “and, in the case of employee shareholder shares, section 1038B”;

d

in section 1011(4)(b), “(but see also section 1038B of this Act)“;

e

in sections 1018(1) and 1019(1), “and, in the case of employee shareholder shares, section 1038B”;

f

sections 1022(5), 1026(5), 1027(5), 1033(5) and 1034(5);

g

section 1038B;

h

sections 1292(6ZA) and 1293(5A);

i

in Schedule 4, the entry relating to “employee shareholder share”.

5

The amendments made by this section have effect in relation to shares acquired in consideration of an employee shareholder agreement entered into on or after the relevant day.

6

The relevant day is 1 December 2016, subject to subsection (7).

7

Where the individual entering into an employee shareholder agreement receives the advice referred to in section 205A(6)(a) of the Employment Rights Act 1996—

a

on 23 November 2016, but

b

before 1.30 pm on that day,

the relevant day is 2 December 2016.