Source: http://www.legislation.gov.uk/ukpga/2014/26/schedule/8/part/3/enacted/data.xht?view=snippet&wrap=true
Timestamp: 2017-12-16 05:21:48
Document Index: 359426748

Matched Legal Cases: ['ART 3', 'art 7', 'art 7', 'art 7', 'art 7', 'art 7', 'arts 2']

PART 3CSOP schemes
158Chapter 8 of Part 7 of ITEPA 2003 (employment income: income and exemptions relating to securities: CSOP schemes) is amended as follows.
160(1)Section 521 (introduction to CSOP schemes) is amended as follows.
(b)in paragraph (b) for “those” substitute “CSOP schemes which are Schedule 4 CSOP”.
(5)In subsection (3)(c) for “approved” substitute “Schedule 4”.
(b)after the definition of “CSOP scheme” insert—
““Schedule 4 CSOP scheme” is to be read in accordance with paragraph 1 and Part 7 of Schedule 4;”.
161In section 522 (share options to which Chapter applies) in subsection (1)(a) for “an approved” substitute “a Schedule 4”.
163Schedule 4 is amended as follows.
164In the title omit “Approved”.
168In the cross-heading before paragraph 4 omit “for approval”.
169For paragraph 5 (general restriction on contents of scheme) substitute—
171In paragraph 15 (requirements relating to shares that may be subject to share options) after sub-paragraph (1) insert—
172In paragraph 21 (requirements relating to share options) in sub-paragraph (1) before the entry for paragraph 22 insert—
“paragraph 21A (general requirements as to terms of option),”.
173After paragraph 21 insert—
“General requirements as to terms of option
21A(1)The following terms of a share option which is granted under the scheme must be stated at the time the option is granted—
(a)the price at which shares may be acquired by the exercise of the option,
(b)the number and description of the shares which may be acquired by the exercise of the option,
(c)the restrictions to which those shares may be subject,
(d)the times at which the option may be exercised (in whole or in part), and
(e)the circumstances under which the option will lapse or be cancelled (in whole or in part), including any conditions to which the exercise of the option is subject (in whole or in part).
(2)Terms stated as required by sub-paragraph (1) may be varied after the grant of the option, but—
(a)in the case of the price, only as provided for in paragraph 22,
(b)in the case of the number or description of shares, only as provided for in paragraph 22 or by way of a mechanism which is stated at the time the option is granted, and
(c)in any other case, only by way of a mechanism which is stated at the time the option is granted.
(3)Any mechanism stated for the purposes of sub-paragraph (2)(b) or (c) must be applied in a way that is fair and reasonable.
(4)Terms stated as required by sub-paragraph (1), and any mechanism stated for the purposes of sub-paragraph (2)(b) or (c), must be notified to the participant as soon as practicable after the grant of the option.”
174(1)Paragraph 22 (requirements as to price for acquisition of shares etc) is amended as follows.
(b)in paragraph (b) for “that time” substitute “the time when the option is granted”.
175(1)Paragraph 25 (exercise of options: death) is amended as follows.
(2)Make the existing text sub-paragraph (1).
(3)In the new sub-paragraph (1) omit “but not later than 12 months after that date”.
(4)After the new sub-paragraph (1) insert—
“(2)Provision made under sub-paragraph (1) must permit the exercise of the options at any time on or after the date of death but not later than 12 months after that date.”
177(1)Paragraph 26 (exchanges of options on company reorganisation) is amended as follows.
(2)In sub-paragraph (2) after paragraph (b) insert—
181After paragraph 35 insert—
35ZA(1)For the purposes of the CSOP code a “non-UK company reorganisation arrangement” is an arrangement made in relation to a company under the law of a territory outside the United Kingdom—
186In the title for “Approved” substitute “Schedule 4”.
188In paragraph 12 (relief where income tax charged in respect of grant of option) in sub-paragraph (4)(b) for “approved” substitute “a Schedule 4 CSOP scheme”.
189In paragraph 13 (market value rule not to apply) in sub-paragraphs (1)(a) and (3) for “approved” substitute “a Schedule 4 CSOP scheme”.
192In section 417 (scope of Part 7) in subsection (2), in the entry for Chapter 8, omit “approved”.
193In section 431A (which makes provision relating to restricted securities etc) in subsection (2)(c) for “an approved” substitute “a Schedule 4”.
194In section 473 (introduction to taxation of securities options) in subsection (4)(b) for “approved” substitute “Schedule 4”.
195In section 475 (no charge in respect of acquisition of option) in subsection (2) omit “approved”.
199In section 549 (application of Chapter 11 of Part 7) in subsection (2)(c) omit “approved”.
200(1)Section 554E (exclusions under Part 7A) is amended as follows.
(2)In subsection (1)(c) for “an approved” substitute “a Schedule 4”.
(3)In subsection (3)(a)(ii) and (b)(ii) for the second “an approved” substitute “a Schedule 4”.
(4)In subsection (4)(a) and (b) for the third “approved” substitute “Schedule 4”.
210(1)This paragraph applies if, immediately before 6 April 2014 the scheme was an approved CSOP scheme which contains provision authorised by paragraph 22(3) of Schedule 4 to ITEPA 2003.
(2)On and after 6 April 2014, the scheme has effect with any modifications needed to reflect the amendments made by paragraph 174(3) and (4) above.
213(1)Paragraph 28A of Schedule 4 to ITEPA 2003 (as inserted by paragraph 179 above) has effect in relation to the scheme—
(i)as if, in sub-paragraph (3)(b), the reference to that date were a reference to 6 April 2014 and, accordingly, as if all references in paragraph 28A to the first grant date were references to 6 April 2014,
(2)But the scheme cannot be a Schedule 4 CSOP scheme if, before 6 April 2014, an application for its approval was refused or an officer of Revenue and Customs decided to withdraw its approval.
(3)Sub-paragraph (2) is without prejudice to the outcome of any appeal under paragraph 29 or 32 of Schedule 4 to ITEPA 2003 against the refusal or decision to withdraw approval.
(4)The amendments made by this Part do not affect any right of appeal under paragraph 29 or 32 of Schedule 4 to ITEPA 2003 against a refusal or decision made before 6 April 2014 in relation to the scheme.
(5)Sub-paragraph (6) applies if a share option was granted before 6 April 2014 under the scheme at a time when the scheme was an approved CSOP scheme.
(6)On and after 6 April 2014, the CSOP code has effect in relation to the option as if it were granted under the scheme at a time when the scheme was a Schedule 4 CSOP scheme (but not if no notice under paragraph 28A of Schedule 4 to ITEPA 2003 is given in relation to the scheme or if the scheme cannot be a Schedule 4 CSOP scheme because of sub-paragraph (2) of this paragraph).
(7)In relation to the scheme—
(a)paragraph 28F of Schedule 4 to ITEPA 2003 (as inserted by paragraph 179 above) has effect as if for sub-paragraph (2) there were substituted—
(b)the cases covered by paragraphs 28F(4)(b), 28H(1)(a)(ii) and 28I(1)(a)(ii) of Schedule 4 to ITEPA 2003 (as inserted by paragraph 179 above) include cases in which requirements of Parts 2 to 6 of that Schedule were not met before 6 April 2014.
214If the scheme was an approved CSOP scheme before 6 April 2014, the amendments made by this Part and paragraphs 140 and 142 above do not affect the deductions which may be made in relation to the scheme under section 94A of ITTOIA 2005 or section 999 of CTA 2009 (deduction for costs of setting up scheme) if they would otherwise do so.