TCGA92/S149AA

TCGA92/S149AA prevents the market value rule applying to the acquisition of convertible employment-related securities. See CG56321. The acquisition cost for capital gains purposes is instead built up from the actual cost and amounts chargeable to Income Tax.

Section 437 ITEPA03 provides that for the purposes of any liability to Income Tax in respect of earnings under Section 62 ITEPA03 the market value of convertible employment-related securities is normally to be determined as if they were not convertible. Thus, if the employee's acquisition cost for capital gains purposes were to be market value, there could be a mismatch. (See CG56337.)

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