(4) Chapter 2 does not apply by reason of an event within subsection (5)
30if by virtue of the event an amount counts as employment income of
A in respect of A’s employment with B.

(5) The events within this subsection are—

(a) a chargeable event for the purposes of section 426, 438 or 476,

(b) an event which gives rise to the discharge of a notional loan
35for the purposes of section 446U, or

(c) a disposal to which Chapter 3D of Part 7 applies.

(6) Chapter 2 does not apply by reason of an event to which subsection
(4) would apply apart from section 421B(6), 421E(1), 429, 443, 474(1)
or 477(2) or apart from an election under section 430 or 431.

(7) 40Subsection (11) applies if there is an acquisition of an asset within
section 554C(4)(a) or (b) (“the relevant asset”) and—

(a) relevant consideration is given by A for the relevant asset of
an amount equal to or greater than the market value of the
relevant asset at the time of the acquisition, or

(b) 45ignoring any relevant consideration given for the relevant
asset, the acquisition gives rise (or would give rise) to

earnings of A within Chapter 1 of Part 3 from A’s
employment with B—

(i) the amount of which is equal to or greater than the
market value of the relevant asset at the time of the
5acquisition, and

(ii) which are not exempt income.

(8) In subsection (7) “relevant consideration”—

(a) means consideration—

(i) which is given before, or at or about, the time of the
10acquisition, and

(ii) which is money or money’s worth, but

(b) does not include—

(i) a promise to do anything, or

(ii) the performance of any duties of, or in connection
15with, an employment.

(9) If section 437(1) or 452(1) applies in relation to the acquisition, or
would apply if Chapter 3 or 4A of Part 7 (as the case may be) applied
in relation to the acquisition, in subsection (7) references to the
market value of the relevant asset are to be read as references to that
20value determined on the basis mentioned in section 437(1) or 452(1)
(as the case may be).

(10) Subsection (11) also applies if—

(a) there is an acquisition of an asset within section 554C(4)(a) or
(b) (“the relevant asset”),

(b) 25the acquisition is pursuant to an employment-related
securities option (within the meaning of Chapter 5 of Part 7,
but ignoring section 474(1)) acquired by reason of A’s
employment, or former or prospective employment, with B,
and

(c) 30the acquisition is a chargeable event for the purposes of
section 476 or would be a chargeable event apart from section
474(1).

(11) Chapter 2 does not apply by reason of a relevant step taken after the
acquisition if—

(a) 35the subject of the relevant step is the relevant asset, and

(b) there is no connection (direct or indirect) between the
relevant step and a tax avoidance arrangement.

(12) In subsections (7) to (11) “acquisition” is to be read in accordance
with section 421B(2)(a).

(13) 40Chapter 2 does not apply by reason of a relevant step within section
554C(1)(a) taken by a person if—

(a) the payment of the sum of money is by way of a loan (“the
relevant loan”),

(b) the relevant loan is made and used solely for the purpose of
45enabling A to exercise an employment-related securities
option (within the meaning of Chapter 5 of Part 7),

(c) the exercise of the option by A gives rise to employment
income of A in respect of A’s employment with B—