ERSM30070 - Restricted Securities

Taxation treatment: shares acquired between 26 October 1987 and 15 April 2003: exemption from charge: the 7 year rule

An event is only a chargeable event, and therefore only creates employment income, if the person who acquired the shares has been, at some time within the period of seven years ending with the date of the chargeable event, a director or employee of one of the following companies ITEPA03/S452 (as originally enacted):

• The company that issued the shares.
• The company as a director or employee of which he or she acquired the shares. This could be a different company from the one that issued the shares. The employee might, for instance, work for a subsidiary group company and be given shares in the group parent. Or the employee might be given shares in a company completely unconnected with the one for which he or she works.
• An associated company of one of the above. Associated company has the meaning given to it by ICTA88/S416.