Section 105A: Shares acquired on same day: election for alternative treatment, Taxation of Chargeable Gains Act 1992

Subsection (2) below applies where an individual—

acquires shares ("the relevant shares") of the same class, on the same day and in the same capacity, and

some of the relevant shares ("the tax-advantaged-scheme shares") are shares acquired by him as a result of—

the exercise of a qualifying option within the meaning given by section 527(4) of ITEPA 2003 (enterprise management incentives) in circumstances where section 530 or 531 of that Act (exercise of option to acquire shares) applies, or

the exercise of an option to which Chapter 7 or 8 of Part 7 of that Act (... share option schemes) applies in circumstances where section 519(1) or 524(1) of that Act applies.

Where the individual first makes a disposal of any of the relevant shares, he may elect for subsections (3) to (5) below to have effect in relation to that disposal and all subsequent disposals of any of those shares.

In circumstances where section 105 applies, that section shall have effect as if—

paragraph (a) of subsection (1) of that section required the tax-advantaged-scheme shares to be treated as acquired by the individual by a single transaction separate from the remainder of the relevant shares (which shall also be treated by virtue of that paragraph as acquired by the individual by a single transaction), and

subsection (1) of that section required the tax-advantaged-scheme shares to be treated as disposed of after the remainder of the relevant shares.

If the relevant shares include shares to which relief under Chapter 3 of Part 7 of the Taxes Act, relief under Part 5 of ITA 2007 or deferral relief (within the meaning of Schedule 5B to this Act) is attributable—

paragraph 4(4) of that Schedule has effect as if it required the tax-advantaged-scheme shares falling within paragraph (a), (b), (c) or (d) of that provision to be treated as disposed of after the remainder of the relevant shares falling within the paragraph in question, and

section 299 of the Taxes Act or section 246 of ITA 2007 has effect for the purposes of section 150A(4) below as if it required—

the tax-advantaged-scheme shares falling within paragraph (a), (b), (c) or (d) of subsection (6A) of section 299 of the Taxes Act or subsection (3) of section 246 of ITA 2007 to be treated as disposed of after the remainder of the relevant shares falling within the paragraph in question, and

the tax-advantaged-scheme shares to which subsection (6B) of section 299 of the Taxes Act or subsection (4) of section 246 of ITA 2007 applies to be treated as disposed of after the remainder of the relevant shares to which that subsection applies.

Where section 127 applies in relation to any of the relevant shares ("the reorganisation shares"), that section shall apply separately to such of those shares as are tax-advantaged-scheme shares and to the remainder of the reorganisation shares (so that those tax-advantaged-scheme shares and the remainder of the reorganisation shares are treated as comprised in separate holdings of original shares and identified with separate new holdings).

In subsection (5)—

the reference to section 127 includes a reference to that section as it is applied by virtue of any enactment relating to chargeable gains, and

"original shares" and "new holding" have the same meaning as in section 127 or (as the case may be) that section as applied by virtue of the enactment in question.

For the purposes of subsection (1) above—

any shares to which relief under Chapter 3 of Part 7 of the Taxes Act or relief under Part 5 of ITA 2007 is attributable and which were transferred to an individual as mentioned in section 304 of the Taxes Act or section 245 of ITA 2007, and

any shares to which deferral relief (within the meaning of Schedule 5B to this Act), but not relief under that Chapter or relief under that Part, is attributable and which were acquired by an individual on a disposal to which section 58 above applies,

shall be treated as acquired by the individual on the day on which they were issued.

In this section the references to Chapter 3 of Part 7, section 299 and section 304 of the Taxes Act shall be read as references to those provisions as they apply to shares issued after 31st December 1993 (enterprise investment scheme).

In this section references to Part 5 of ITA 2007 or any provision of that Part are to a Part or provision that applies only in relation to shares issued after 5 April 2007.

Section 105A: Shares acquired on same day: election for alternative treatment

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