Section 473 — Income Tax (Earnings and Pensions) Act 2003: Introduction to taxation of securities options

Introduction to taxation of securities options 473 1 The starting-point is that section 475 contains an exemption from the liability to tax that might otherwise arise under—

a Chapter 1 of Part 3 (earnings), or b Chapter 10 of that Part (taxable benefits: residual liability to charge), when an employment-related securities option is acquired.

2 Liability to tax may arise, when securities are acquired pursuant to the employment-related securities option, under—

a section 446B (charge on acquisition where market value of securities or interest artificially depressed),

b Chapter 3C of this Part (acquisition of securities for less than market value), or c section 476 (acquisition of securities pursuant to securities option).

3 Liability to tax may also arise by virtue of section 476 when—

a the employment-related securities option is assigned or released, or b a benefit is received in connection with the employment-related securities option.

4 There are special rules relating to share options acquired under—

a Schedule 3 SAYE option schemes (see Chapter 7 of this Part),

b Schedule 4 CSOP schemes (see Chapter 8 of this Part), or c enterprise management incentives (see Chapter 9 of this Part).