Section 431 — Finance Act 2003: Election for full or partial disapplication of this Chapter

Election for full or partial disapplication of this Chapter 431 1 The employer and the employee may elect in relation to employment-related securities which are restricted securities or a restricted interest in securities that—

a for the relevant tax purposes their market value at the time of the acquisition is to be calculated as if they were not, and b sections 425 to 430 are not to apply to the employment-related securities.

2 Or the employer and the employee may elect in relation to employment-related securities which are restricted securities or a restricted interest in securities that—

a for the relevant tax purposes their market value at the time of the acquisition is to be calculated, and b sections 425 to 430 are to apply to the employment-related securities, as if any specified restriction did not apply to the employment-related securities.

3 For the purposes of subsections (1) and (2) “ the relevant tax purposes ” are—

a determining any amount that is to constitute earnings from the employment under Chapter 1 of Part 3 (earnings),

b determining the amount of any gain realised on the occurrence of an event that is a chargeable event by virtue of section 439(3)(a) (conversion),

c operating Chapter 3C of this Part (acquisition of securities for less than market value),

and d determining any amount that counts as employment income of the employee under Chapter 5 of this Part (securities acquired pursuant to securities option).

4 An election under this section—

a is to be made by agreement by the employer and the employee, and b is irrevocable.

5 Such an agreement—

a must be made in a form approved by the Board of Inland Revenue, and b may not be made more than 14 days after the acquisition.