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HMRC internal manual

Capital Gains Manual

Employee shareholder shares: CG-exemption


Subject to conditions, a gain accruing on a disposal by an employee shareholder of an employee shareholder share is not a chargeable gain and a loss is not an allowable loss (see CG15800):

  • CG-exemption applies only to the first £50,000 worth of employee shareholder shares acquired by the employee in consideration of an employee shareholder agreement. See CG56720.
  • CG-exemption does not apply to an employee shareholder share if the employee or an individual connected with the employee has a material interest in either the employer company or a parent undertaking. See CG56735.

An employee shareholder share that satisfies the conditions for exemption is referred to as an ‘exempt employee shareholder share’.