Income Tax (Earnings and Pensions) Act 2003 section 421F

Exclusions: public offers

Section 421F excludes shares acquired through public offers from certain employment-related securities tax charges, subject to anti-avoidance rules.

• Shares or interests in shares acquired under a public offer are excluded from the tax charges in Chapters 2, 3 and 3C of the employment-related securities rules
• The exclusion does not apply if a main purpose of the arrangements for acquiring or holding the shares is the avoidance of tax or national insurance contributions
• Where a company makes both a public offer and a separate employee offer (as described in the priority share allocation rules), acquisitions under either offer are treated as made under a public offer for the purposes of this exclusion
• This treatment applies regardless of whether the employee receives any benefit from a priority allocation that would otherwise be exempt from income tax