Income Tax (Earnings and Pensions) Act 2003 section 44-48

Conditional interests in shares

Section 44-48 of Schedule 7 provides transitional rules for the tax treatment of conditional interests in shares acquired by employees before the current legislation came into force.

• The rules on conditional interests in shares (Chapter 2 of Part 7) do not apply at all to interests acquired before 17th March 1998
• For share acquisitions made before 6th April 2003, the exemption from charge was determined by whether the person was chargeable under the old Case I of Schedule E, rather than by reference to the current earnings rules
• When calculating the tax charge on shares ceasing to be conditional (or on disposal) for pre-6th April 2003 acquisitions, deductible amounts include any tax already charged under Schedule E on the acquisition and any tax charged under the old unapproved share scheme rules in sections 78 or 79 of Finance Act 1988 for events before that date
• Paragraphs 47 and 48 have been repealed and are no longer in force