Income Tax (Earnings and Pensions) Act 2003 section 446IA

Disapplication of exceptions from charges

Section 446IA ensures that certain exemptions from employment-related securities charges cannot be used where the market value of the securities has been artificially depressed.

• Where shares have been artificially reduced in value, the normal exemptions for restricted securities, convertible securities, securities acquired below market value, and post-acquisition benefits are overridden
• For restricted securities, the usual exemption for certain company shares does not apply if the artificially depressed market value rules would otherwise adjust the charge
• For convertible securities, the exemption is similarly disapplied if the depressed value provisions would affect the calculation of the conversion charge or related consideration
• For securities acquired below market value and for post-acquisition benefits from securities, the respective exemptions are also disapplied where the artificial depression of value rules would have effect