Arrangements that are designed to incentivise employees by
delivering post-acquisition benefits will not normally be subject
to the anti-avoidance provisions of Chapter 3B (securities with
artificially enhanced market value) unless they are designed to
avoid paying the right amount of tax and NICs at the right time.
Where the avoidance of tax and/or NICs is the main purpose,
or one of the main purposes, of the arrangements the anti-avoidance
provisions of Chapter 3B may apply. See Example 3 in
ERSM60030 where the rise in share value
after a dividend is voted or decided upon can lead to a charge. The
corresponding fall in value after a dividend is paid is ignored.
Where the benefit passed to the employee is taxed through
Chapter 3B, HMRC would not seek to tax the same benefit under a
Chapter 4 charge on the dividend.
