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HMRC internal manual

Employment Related Securities Manual

HM Revenue & Customs
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Convertible securities: introduction

Chapter 3 Part 7 ITEPA 2003 treats value arising from the conversion of securities of one description to securities of a different description as employment income. Chargeable events also arise from the receipt of consideration in connection with the conversion rights. Employment income arises in the tax year when a chargeable event arises.

The following guidance applies to conversions or consideration received on or after 1 September 2003. Where shares have converted before that date, guidance has been archived.