Corporation Tax Act 2009 section 1021

How the relief is given

Section 1021 explains how relief for employee share acquisitions under Chapter 3 (options to acquire shares) is given, including the accounting period in which it applies and the method of deduction depending on the type of company involved.

• Relief is given for the accounting period in which the shares are acquired, and is normally deducted when calculating the profits of the qualifying business for corporation tax purposes
• Where the employing company is an investment company, the relief is treated as management expenses of the company — unless the qualifying business is a property business, in which case the normal profit deduction applies instead
• Where the employing company is subject to the I minus E rules and the relief relates to basic life assurance and general annuity business (BLAGAB), the relief is treated as ordinary BLAGAB management expenses for the relevant accounting period
• Where the relevant employment relates to more than one qualifying business or part of a business, the relief must be apportioned on a just and reasonable basis