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HMRC internal manual

Employment Related Securities Manual

Securities Options: non-residents: exercise after leaving UK

Post-Schedule 22 until 5 April 2015

Options acquired up to 5 April 2008

If a person was resident and ordinarily resident with earnings taxable under sections 15 or 21 when the right to acquire securities was acquired (for example, when the option was granted) then, even if they have become non-resident by time the securities are acquired, or some other chargeable event occurs, they are still chargeable under Chapter 5.

If a person was either not resident or not ordinarily resident when the right was acquired then, depending on the characteristics of the option and the circumstances of its award, there may be an earnings charge at the time the securities are acquired or a notional loan under Chapter 3C (see ERSM70000+).

Options acquired on or after 6 April 2008

If a person was UK-resident with earnings taxable under sections 15, 22 or 26 when the right to acquire securities was acquired (for example, when the option was granted) then, even if they have become non-resident by time the securities are acquired, or some other chargeable event occurs, they are still chargeable under Chapter 5.

If a person was not UK-resident when the right was acquired then, depending on the characteristics of the option and the circumstances of its award, there may be an earnings charge at the time the securities are acquired or a notional loan under Chapter 3C (see ERSM70000+).

From 6 April 2015, with the removal of the residence exclusion at ITEPA03/S474 (see ERSM20300), Chapter 5 can apply to securities options acquired whilst the employee is not resident in the UK and not carrying out duties in relation to a UK employment. See ERSM162000.