Employment-Related Securities and Unlisted Companies
By Ken Moody
This book explains the tax implications of employee share awards by private companies in the UK, including completion of Form 42, restricted securities, share options (approved and unapproved), Capital Gains Tax and Pay As You Earn (PAYE)/National Insurance Contributions issues, and UK corporation tax relief. The expanded second edition features detailed commentary on Enterprise Management Incentives (EMI) options and includes two EMI option agreement precedents. New chapters have also been added, covering the Company Share Option Plan, internationally mobile employees, and practical discussion of valuation of Employment-Related Securities (ERS). Often, the tax implications of the ERS rules are not onerous, but sometimes result in an income tax charge for the employee, and the company may also be obliged to pay PAYE and National Insurance Contributions. If a director or employee acquires shares free or for less than they are worth, they are liable to income tax on the difference. The book explains how the rules for taxing such share awards work, including the rules for non-HMRC approved share options and for options qualifying under EMI. There are also chapters dealing with UK capital gains tax aspects of shares and share options, the PAYE and national insurance implications, and the corporation tax deduction which may be claimed by the company.
Publication Date: 10/20/2013