According to the Revenue website a person is entitled to tax relief on new shares purchased by an employee. This is taken from the revenue website from the Guide to Completing 2006 Pay & File Returns Panel I:
"Purchase of New Shares in a Company by an Employee [616]
Employees/directors are eligible for a deduction from total income in respect of the purchase of new ordinary
shares issued at full market value by their employer company, (or its holding company where the employer is a
75% subsidiary of the holding company). The investment can be made over a number of years and a total
deduction of £6,350 (lifetime limit) from an individual’s total income is given for the year(s) in which the shares
were issued.
To qualify for this relief, the employee/director must take up new shares on issue and must hold them for three
years. Provision is made for a claw back of relief where eligible shares are disposed of within three years of
acquisition or where the employee/director receives any money or money’s worth which is not regarded as
income in his/her hands for income tax purposes in respect of the shares."
My question is what exactly is a new ordinary share. If a person purchases shares in their company from the open market a couple of months after it has floated. Does this count for the relief.
"Purchase of New Shares in a Company by an Employee [616]
Employees/directors are eligible for a deduction from total income in respect of the purchase of new ordinary
shares issued at full market value by their employer company, (or its holding company where the employer is a
75% subsidiary of the holding company). The investment can be made over a number of years and a total
deduction of £6,350 (lifetime limit) from an individual’s total income is given for the year(s) in which the shares
were issued.
To qualify for this relief, the employee/director must take up new shares on issue and must hold them for three
years. Provision is made for a claw back of relief where eligible shares are disposed of within three years of
acquisition or where the employee/director receives any money or money’s worth which is not regarded as
income in his/her hands for income tax purposes in respect of the shares."
My question is what exactly is a new ordinary share. If a person purchases shares in their company from the open market a couple of months after it has floated. Does this count for the relief.