Minutes of the annual Technical Meeting of the Share Plan Lawyers with HMRC on 10 November 1993

Minutes of a technical meeting with the Inland Revenue on 10 November 1993 regarding:

  • the taxation of “capital receipts” under an approved profit sharing scheme;
  • Inland Revenue policy on provisions in an executive share option scheme which allow directors a discretion to permit or prohibit the exercise of options;
  • amendment clauses in the rules of approved executive share option schemes and savings related share option schemes – Eurocopy case;
  • Inland Revenue approach in cases where options granted partially in excess of scheme limits where the rules do not contain a “blue pencil” provision;
  • exercise of options granted under a savings related share option scheme on a scheme of arrangement;
  • adjustments to options granted by the trustees of an employee share ownership trust following a rights issue;
  • impact of a demerger on employee qualification in relation to an employee share ownership trust;
  • Inland Revenue policy regarding what constitutes an alteration to a scheme, in particular with regard to letters to optionholders e.g. on a change of control;
  • meaning of “employee-control shares” in paragraph 14(3)(a), Schedule 9, Income & Corporation Taxes Act 1988;
  • meaning of “restrictions” for the purposes of an approved scheme;
  • Inland Revenue policy regarding the capital gains tax position on unapproved options;
  • income tax position on rollover of unapproved share options;
  • applicability of PAYE to the surrender of share options – CIR v Herd; and
  • tax position where compensation is paid to optionholders for loss of options.
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Keywords: CGT, Change of Control, Demerger, Discretion, HMRC compliant plans, Income tax, PAYE, Plan limits, Pre-emption rights, Profit Sharing Scheme, Restricted securities, Rollover, SAYE, Scheme of arrangement
Categories: Document archive, HMRC meetings