There are a number of circumstances when a UK employee or director receiving shares should complete an ITEPA S431 election
To minimise the risk of any future income tax charges under the 'restricted securities legislation', there are times when a UK employee or Director should be required to enter into a section 431 election within 14 days of the acquisition of shares.
For the purpose of activities on the Vestd platform, the key times are listed below:
1) On acquisition of conditional growth shares.
2) On the exercise of EMI options, when the shares cannot be immediately sold and the exercise price has been set below the Actual Market Value (AMV) agreed with HMRC at the date of grant of the options.
3) On the exercise of EMI options, when exercised more than 90 days after the holder has become ineligible, and the holder has chosen for the tax at this point to be based on the Unrestricted Market Value, rather than the AMV of the shares at the time.
4) On the exercise of Unapproved options by a UK employee or Director, when the holder has chosen for the tax at this point to be based on the Unrestricted Market Value, rather than the AMV of the shares at the time.
An example document can be found via HMRC here.
In most circumstances all restrictions will be disapplied in Section 4 of the form.