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Home / Simons-Taxes /Corporate tax /Part D1 Corporation tax generally /Division D1.3 UK resident companies—calculation of taxable profits /Relief for employee share and share option acquisitions / D1.338 Relief for convertible shares
Commentary

D1.338 Relief for convertible shares

Corporate tax

Securities are convertible securities if1:

  1. Ìý

    •ÌýÌýÌýÌý they confer on the holder an immediate or conditional right to convert them to different securities

  2. Ìý

    •ÌýÌýÌýÌý there is an agreement or arrangement under which such rights will be granted in certain circumstances, or

  3. Ìý

    •ÌýÌýÌýÌý there is an agreement or arrangement under which a person other than the holder may convert the securities

Shares are convertible shares if they are convertible securities; or an interest in such securities2.

'Original' relief is given on the award of convertible shares. If there is a further chargeable event, 'additional' relief is available as discussed below.

Original relief

Relief is given on the award of convertible shares. Where the convertible shares are also restricted shares, the original relief is the greater of the amounts described below and those described in D1.3373.

A just and reasonable apportionment of the relief is made where the consideration is given partly for other matters or the award or grant was given in part for the purposes

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