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(b) by paragraphs 28 and 29 of Schedule 9 to ICTA: limit of £30,000 on | |
value of shares subject to outstanding options and requirements as | |
to price for acquisition of shares). | |
(2) On and after 6th April 2003 the scheme is to continue to have effect as if it | |
provided— | 5 |
(a) that an individual may not be granted share options under it which | |
would at the time when they are granted cause the aggregate market | |
value of the shares which the individual may acquire by exercising | |
share options granted under— | |
(i) the scheme, or | 10 |
(ii) any other approved CSOP scheme established by the scheme | |
organiser or an associated company of the scheme organiser, | |
to exceed or further exceed £30,000 (leaving out of account share | |
options that have already been exercised), and | |
(b) that the price at which shares may be acquired by the exercise of a | 15 |
share option granted under the scheme must not be manifestly less | |
than the market value of shares of the same class at that time (or, if | |
the Board of Inland Revenue and the scheme organiser agree in | |
writing, at an earlier time or times stated in the agreement). | |
(3) For the purposes of sub-paragraph (2)(a), the market value of shares is to be | 20 |
calculated as at— | |
(a) the time when the options relating to them were granted, or | |
(b) if an agreement relating to them has been made under paragraph 22 | |
of Schedule 4 (requirements as to price for acquisition of shares) the | |
earlier time or times stated in the agreement. | 25 |
(4) Sub-paragraph (2) is subject to any amendment to the scheme made after | |
28th April 1996 (whether before or after 6th April 2003). | |
(5) In this paragraph “discretionary share option scheme” has the same | |
meaning as in paragraph 73. | |
(6) Other expressions used in this paragraph and contained in the index at the | 30 |
end of Schedule 4 (index of expressions defined in the CSOP code) have the | |
meaning indicated in that index. | |
76 (1) This paragraph applies to any right obtained by an individual— | |
(a) under a discretionary share option scheme approved under | |
Schedule 9 to ICTA, and | 35 |
(b) during the period beginning with 17th July 1995 and ending with | |
28th April 1996, | |
if, by virtue of section 115 of FA 1996 (transitional provisions which gave | |
retrospective effect to certain amendments relating to discretionary share | |
option schemes), the right was, immediately before 6th April 2003, treated | 40 |
for the purposes of sections 185 to 187 of and Schedule 9 to ICTA as having | |
been obtained otherwise than in accordance with the provisions of a | |
discretionary share option scheme approved under that Schedule. | |
(2) For the purposes of the CSOP code, the right is to be treated as having been | |
granted otherwise than in accordance with the provisions of an approved | 45 |
CSOP scheme. | |
(3) In this paragraph “discretionary share option scheme” has the same | |
meaning as in paragraph 73. | |
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Enterprise management incentives | |
77 (1) This paragraph applies where, immediately before 6th April 2003, a share | |
option was a qualifying option for the purposes of Schedule 14 to FA 2000 | |
(enterprise management incentives). | |
(2) On and after that date the share option is to be treated as a qualifying option | 5 |
for the purposes of the EMI code. | |
(3) Sub-paragraph (2) has effect even if the requirements that had to be met in | |
order for the share option, or any share option replaced by it, to be a | |
qualifying option for the purposes of Schedule 14 to FA 2000 differed to any | |
extent from those set out in Schedule 5. | 10 |
(4) In this paragraph “share option” means a right to acquire shares. | |
78 (1) In section 535 (disqualifying events relating to employee), subsections (2) to | |
(6) apply to the tax year 2003-04 and later tax years (in accordance with | |
section 723(1)). | |
(2) In Schedule 14 to FA 2000 (enterprise management incentives), paragraph 52 | 15 |
(disqualifying events: actual relevant working time) continues to apply in | |
relation to April 2003 for the purpose of calculating, in accordance with sub- | |
paragraphs (3) to (5) of that paragraph, whether a disqualifying event is to | |
be taken to have occurred at the end of the tax year 2002-03. | |
(3) If a disqualifying event is to be taken to have so occurred, it (like anything | 20 |
else which under that Schedule is a disqualifying event immediately before | |
6th April 2003) is a disqualifying event for the purposes of Schedule 5 to this | |
Act. | |
79 (1) Section 536 (other disqualifying events) has effect in relation to any | |
alteration made to the share capital of a company before 11th May 2001 with | 25 |
the following modification. | |
(2) In subsection (1), for paragraphs (b) and (c) substitute— | |
“(b) any alteration to the share capital of the relevant | |
company to which section 537 applies and is made without | |
the prior approval of the Inland Revenue;”. | 30 |
80 (1) Section 537 (alteration of share capital for purposes of section 536) has effect | |
in relation to any alteration made to the share capital of a company before | |
11th May 2001 with the following modifications. | |
(2) In subsection (1), omit “and (c)”. | |
(3) In subsection (2), substitute “This section” for “This subsection”. | 35 |
(4) Omit subsection (3). | |
81 In a case where the qualifying option was granted before 6th April 2003, | |
section 540(2) (no charge on acquisition of shares as taxable benefit) applies | |
in relation to the time when the option was granted with the substitution of | |
“the employee was chargeable to tax under Case I of Schedule E” for the | 40 |
words from “the earnings” onwards. | |
82 (1) This paragraph relates to the operation of section 541(2) (effects on tax | |
charges where shares cease to be conditional only or are converted) in | |
relation to an FA 2000 option which was exercised before 6th April 2003. | |
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(2) The references to a qualifying option include an FA 2000 option which was | |
so exercised; but in relation to such an option sub-paragraph (3) applies | |
instead of section 541(3). | |
(3) For the purposes of section 541(2) “the amount of relief on the exercise of the | |
option” means the difference between— | 5 |
(a) the amount on which tax would have been chargeable under section | |
135 of ICTA (charge on exercise etc. of option) in respect of the | |
exercise of the option apart from Schedule 14 to FA 2000 (enterprise | |
management incentives), and | |
(b) the amount (if any) in fact so chargeable in accordance with that | 10 |
Schedule. | |
(4) In this paragraph an “FA 2000 option” means a qualifying option for the | |
purposes of Schedule 14 to FA 2000. | |
83 In Schedule 5 (enterprise management incentives), paragraph 41(6) (like | |
other provisions of that paragraph) applies to replacement options | 15 |
whenever granted. | |
Employee benefit trusts | |
84 In relation to times before 6th April 2003, section 549(5) (definition of | |
“employee” for purposes of Chapter 11 of Part 7) is to be read as referring to | |
a person holding an office or employment whose emoluments were | 20 |
chargeable under Schedule E. | |
Part 8 | |
Approved profit sharing schemes | |
Trustees duty to provide information | |
85 Any obligation imposed in accordance with paragraph 34(b) of Schedule 9 | 25 |
to ICTA (trustees’ duties to provide information) on the trustees of a profit | |
sharing scheme approved under that Schedule is to be construed as an | |
obligation, where an amount counts as employment income of a participant | |
by reason of the occurrence of any event, to inform the participant of any | |
facts relevant to determining the participant’s resulting liability to tax. | 30 |
Share incentive plans | |
86 (1) Where the trustees of an approved share incentive plan acquire shares from | |
the trustees of an approved profit sharing scheme, the disposal and the | |
acquisition by the trustees are treated for capital gains tax purposes as being | |
made for such consideration as to secure that neither a gain nor a loss | 35 |
accrues on the disposal. | |
(2) In such a case the relevant period for the purposes of paragraph 2 of | |
Schedule 7D to TCGA 1992 is determined as if the shares had been acquired | |
by the trustees of the share incentive plan at the time they were acquired by | |
the trustees of the other trust. | 40 |
This does not affect the date on which the trustees of the share incentive plan | |
are treated as acquiring the shares for the purposes of taper relief. | |
(3) In this paragraph— | |
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“approved profit sharing scheme” means a profit sharing scheme | |
approved under Schedule 9 to ICTA, and | |
“approved share incentive plan” means a share incentive plan | |
approved under Schedule 2 to this Act. | |
Other share schemes: eligibility of individuals and material interests | 5 |
87 (1) In applying any of the provisions specified in sub-paragraph (2) (which deal | |
with the meaning of “material interest” for the purpose of determining | |
eligibility to participate in share schemes, etc.) the following are to be | |
disregarded— | |
(a) the interest of the trustees of any profit sharing scheme approved | 10 |
under Schedule 9 to ICTA in any shares which are held by them in | |
accordance with the plan but which have not been appropriated to | |
an individual, and | |
(b) any rights exercisable by the trustees as a result of that interest. | |
(2) The provisions referred to in sub-paragraph (1) are— | 15 |
(a) paragraph 20 of Schedule 2 (approved share incentive plans); | |
(b) paragraph 12 of Schedule 3 (approved SAYE option schemes); | |
(c) paragraph 10 of Schedule 4 (approved CSOP schemes); | |
(d) paragraph 29 of Schedule 5 (enterprise management incentives). | |
Part 9 | 20 |
Social Security income | |
Disabled person’s and working families’ tax credits | |
88 (1) This paragraph applies if, on 6th April 2003, the repeals made by TCA 2002 | |
of the provisions listed in sub-paragraph (3) have not come fully into force. | |
(2) Until the repeal of those provisions has come fully into force, Table B in | 25 |
section 677(1) of this Act is to be read as if it included references to disabled | |
person’s tax credit and working families’ tax credit. | |
(3) The provisions referred to in this paragraph are— | |
(a) in SSCBA 1992, section 128 (working families’ tax credit) and section | |
129 (disabled person’s tax credit), and | 30 |
(b) in SSCB(NI)A 1992, section 127 (working families’ tax credit) and | |
section 128 (disabled person’s tax credit). | |
Part 10 | |
PAYE | |
PAYE regulations | 35 |
89 (1) In relation to any time before the commencement of the repeals in Part VII | |
of Schedule 20 to FA 1999, section 684(2) (PAYE regulations) has effect with | |
the following modification. | |
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(2) At the end of item 5 insert “including the proving of the contents or | |
transmission of anything that the regulations allow to be transmitted to any | |
person in electronic form or by electronic means”. | |
Part 11 | |
Consequences for corporation tax | 5 |
90 (1) This paragraph applies where— | |
(a) a company is charged to corporation tax by reference to an | |
accounting period which begins before and ends on or after 6th April | |
2003, and | |
(b) because of a change in the law made by this Act, the income tax law | 10 |
relating to the accounting period is different from what it would | |
have been if that change had not been made. | |
(2) If the company so elects, this Act applies with such modifications as may be | |
necessary to secure that the income tax law relating to the accounting period | |
is the same as it would have been if the change in the law had not been made. | 15 |
(3) An election under this paragraph must be made by notice given to the Inland | |
Revenue no later than the end of the period of two years beginning with the | |
day following the last day of the accounting period. | |
(4) In this paragraph “income tax law” has the same meaning as in section 9 of | |
ICTA. | 20 |
91 (1) This paragraph applies in relation to corporation tax charged by reference to | |
an accounting period which begins before and ends on or after 6th April | |
2003. | |
(2) In its application for the purposes of corporation tax, any provision of this | |
Schedule is to be read as if— | 25 |
(a) any reference to the tax year 2003-04 were a reference to that | |
accounting period, and | |
(b) any reference to 6th April 2003 were a reference to the first day of that | |
accounting period. | |
92 (1) The provisions of this Act mentioned in sub-paragraph (2) do not have effect | 30 |
for corporation tax purposes for so much of any accounting period as falls | |
before 6th April 2003. | |
(2) The provisions are— | |
(a) in Schedule 6 (consequential amendments)— | |
(i) paragraph 11 (which replaces references in section 84A of | 35 |
ICTA to share option schemes approved under Schedule 9 to | |
that Act with references to SAYE option schemes and CSOP | |
schemes approved under this Act), and | |
(ii) paragraphs 12 and 109 (which insert Schedule 4AA to ICTA | |
(share incentive plans: corporation tax deductions)), and | 40 |
(b) the repeal by Schedule 8 (repeals) of— | |
(i) Part 12 of Schedule 8 to FA 2000 (corporation tax deductions | |
in relation to employee share option plans), and | |
(ii) so much of any other provision of Schedule 8 to that Act as is | |
necessary for the operation of Part 12. | 45 |
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| | Short title and chapter | Extent of repeal | | | | | Income and Corporation Taxes | Section 313. | | | | | Act 1988 (c. 1)—cont. | Sections 315 to 319. | | | | | | Section 321. | | | | | | Section 322(2). | | 5 | | | | In section 323— | | | | | | (a) subsection (1); | | | | | | (b) in subsection (6), paragraph (b) and the | | | | | | word “and” preceding it; | | | | | | (c) subsection (7). | | 10 | | | | Section 330. | | | | | | Section 332(1), (2), (3A), (3B) and (4). | | | | | | In section 577— | | | | | | (a) in subsection (1), paragraph (b) and the | | | | | | word “and” preceding it; | | 15 | | | | (b) in subsection (3), the words from “but | | | | | | where—” to the end. | | | | | | Section 579(1). | | | | | | Section 580(3). | | | | | | In section 585— | | 20 | | | | (a) in subsection (1), the words “, or under | | | | | | Case III of Schedule E,”; | | | | | | (b) in subsection (9), paragraph (b) and the | | | | | | word “and” preceding it. | | | | | | In section 588, in subsection (5), paragraph (a) | | 25 | | | | and the word “or” preceding paragraph (b). | | | | | | Section 589. | | | | | | Section 589A(2) to (6), (10). | | | | | | In section 589B— | | | | | | (a) subsections (1) to (4A); | | 30 | | | | (b) in subsection (5), the words “this section | | | | | | or”. | | | | | | Section 591D(6). | | | | | | Section 595. | | | | | | Section 596. | | 35 | | | | Sections 596A to 596C. | | | | | | Section 597. | | | | | | Section 599A(5), (6) and (8). | | | | | | Section 600. | | | | | | In section 607(3)(b), sub-paragraph (iv) and the | | 40 | | | | word “and” preceding it. | | | | | | Section 608(4). | | | | | | Section 613 (1) to (3). | | | | | | Section 615(1), (2), (4), (5), (7) and (8). | | | | | | Section 616. | | 45 | | | | Section 617(1) and (2). | | | | | | Section 617A. | | | | | | In section 638(13), the definition of “employee | | | | | | share ownership plan”. | | | | | | In section 643— | | 50 | | | | (a) subsection (1); | | | | | | (b) in subsection (5), the words “shall be | | | | | | assessable to tax under Schedule E (and | | | | | | section 203 shall apply accordingly) and”. | | |
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