The taxable amount on the occurrence of a chargeable event is given by the following formula1:
| AG | is the amount of gain realised on the chargeable event. The calculation of the amount of gain varies according to the category of chargeable event (see below)a. |
| CE | is the amount of consideration given for the entitlement to convert (see below) plus any expenses incurred by the holder of the employment-related securities in connection with the chargeable eventb. |
a    ITEPA 2003, s 440(2).
b    ITEPA 2003, s 440(3).
The amount of consideration regarded as given for the entitlement to convert is determined by the relationship between the amount of the acquisition consideration for the securities or interest in securities (ACS) and the non-convertible market value (NCMV) of the securities (or interest in securities) at acquisition2. There can only be consideration for entitlement to convert if ACS exceeds NCMV. The extent to which the acquisition consideration exceeds non-convertible market value at acquisition determines
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Web page updated on 17 Mar 2025 17:03