Section CX 35 — Income Tax Act 2007: Meaning of employee share loan

CX 35 Meaning of employee share loan Meaning (1) Employee share loan means a loan made to an employee if— (a) the loan is made for the sole purpose of enabling the employee to acquire, under a scheme of acquisition,— (i) shares, rights, or options in the company that is their employer: (ii) shares, rights, or options in a company that is associated with their employer; and (b) the employee uses the loan only for the purpose of the acquisition; and (c) the employee beneficially owns the shares, rights, or options throughout the term of the loan; and (d) the employee must immediately repay the loan in full if they stop being the beneficial owner of any of the shares, rights, or options; and (e) the company issuing the shares, rights, or options must maintain a dividend-paying policy throughout the term of the loan. Exclusions (2) This section does not apply— (a) to shares, rights, or options in a qualifying company: (b) to a loan made under a share purchase scheme: (c) to an employer and an employee who are associated persons. Defined in this Act: associated person , company , dividend , employee , employee share loan , employer , pay , qualifying company , share Compare: 2004 No 35 s CX 29