Securities acquired for less than market value: computing the undervalue
For the purposes of determining whether the full market value has been paid at acquisition (see ERSM70010) the value to be considered is the market value of fully paid-up securities.
Any obligation to make further payments is disregarded in arriving at the undervalue. In other words, a debt taken on is not regarded as consideration given for the securities - ITEPA03/S446Q (2) and ITEPA03/S446R (2).
If an employee acquires an interest in securities which is less than the full beneficial ownership of the shares, the legislation applies just as it would to an acquisition of securities. Market value will be a proportion of the value of the shares concerned that corresponds to the interest in them.
For meaning of market value see ERSM20400.