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HMRC internal manual

Employment Related Securities Manual

From
HM Revenue & Customs
Updated
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Restricted securities: introduction

ERSM20010 describes the ways in which employers seek to incentivise and reward their employees with securities. The most frequently used are those described as ‘restricted’, ‘conditional’ or ‘forfeitable’. A special regime for Income Tax and NICs may apply to employment-related securities if they are restricted securities or a restricted interest in securities at the time of their acquisition. The current rules are set out in ITEPA03/S422 onwards.

There have been a number of changes to the way in which restricted securities have been treated over recent years. These are described in the following pages.

Restricted securities acquired before 16 April 2003 ERSM30030
   
Conditional (forfeitable) securities acquired before 17 March 1998 ERSM30200
Conditional (forfeitable) securities acquired between 17 March 1998 and 15 April 2003 ERSM30210
Restricted or conditional (forfeitable) securities acquired on or after 16 April 2003 - chargeable event before 1 September 2003 ERSM30250
Restricted securities acquired on or after 16 April 2003 - chargeable event on or after 1 September 2003 ERSM30300