CG56320 - Employment-related securities: introduction: employee share schemes
The content in this manual covers a high level of detail. Further information can also be found in the Employee Tax Advantaged Share Scheme User Manual. If you are looking for an introduction to the main rules for employee share schemes, please see the tax and Employee Share Schemes overview on GOV.UK.
A common feature of employee share schemes is that employees may be offered shares, share options, or possibly other securities by reason of their employment. Part 7 of the Income Tax (Earnings and Pensions) Act 2003 (ITEPA03) contains special Income Tax rules about cases where securities or securities options are acquired in connection with an employment and the definition of "securities" for the purposes of the employment related securities legislation includes a wide range of intangible assets in addition to shares.
Some schemes are set up to comply with particular statutory requirements in order to secure beneficial tax treatment. These schemes (EMI, CSOP, SIP & SAYE) are self certified schemes and are often referred to as Tax advantaged or approved schemes.
The operation of the TCGA is modified to take into account the Income Tax treatment of employment-related securities. Guidance on employment-related securities and unapproved schemes generally is at CG56321+. Guidance on approved schemes and the Enterprise Management Incentives is at CG56400+. Apart from points covered there, the normal Capital Gains rules apply.