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§17A.4.5. The third is the extension of PAYE and NICs to produce a uniform application across the rules. |
The chapters of part 7 are as follows: chapter 1 deals with introductory matters, chapter 2 with restricted securities, which can be seen as a wider version of the previous conditional interests in shares, chapter 3 with convertible securities, chapter 4 with post acquisition benefits from securities and chapter 5 with securities options. (sections 471–484/7) Into this scheme FA 2003 has planted chapters 3A–3D, all concerned with potential avoidance through the manipulation of values, so 3A deals with securities with artificially depressed market value, 3B with securities acquired with artificially enhanced market value , 3C with securities acquired for less than market value and 3D with securities disposed for less than market value. Chapters 3A to 3D contain their own heads of charge. However they do not radically alter the situations giving rise to charge—rather they have their own rules imposing tax on the acquisition of securities (chapter 5), or the removal of restrictions securities (chapter 2) or the conversion of convertible securities (chapter 3) and so on. Sometimes they adjust the value to be use for the other provision; more usually they apply their own head of charge. |
As a result of these rules there are many opportunities for the Revenue to tax. It is a welcome feature of these rules that taxpayers may often elect that they do not apply. This usually means that taxpayers are given the chance to pay tax at once by reference to the unmanipulated value rather than in stages. This is presumably in response to points made in the long period of consultation. |
ITEPA part 7 chapter 6 (sections 488–515) §16A.6 covers approved share incentive plans, originally introduced by FA 2000. Chapter 7 (sections 516–520) §16A.7 covers Approved SAYE option schemes. Chapter 8 (sections 521–526) §16A.8 Approved Company Share Option Schemes. Dating from FA 2000, this applies to all employees and has three distinct elements: free |