Corporation Tax Act 2009 section 1007A

Application of Chapter in relation to employees of overseas companies who work for companies in the UK

Section 1007A enables a UK host company to claim corporation tax relief on employee share acquisitions where the employee is formally employed by an overseas company but works in the UK for the host company, such as under a secondment arrangement.

• Where an employee of a non-UK resident company works in the UK for a host company that is within the charge to corporation tax, the employee is treated as having a deemed employment with the host company for the purposes of share acquisition relief
• Shares acquired because of the actual overseas employment are treated as if acquired because of the deemed employment with the host company, provided an amount of employment income has been charged to UK income tax under ITEPA 2003 in relation to the share acquisition
• The amount of relief available is capped at the total employment income charged to tax under ITEPA 2003 in relation to the share acquisition, and if more than one company is eligible for relief on the same share acquisition, only one of them may claim it
• References to the employing company in the conditions relating to shares acquired are extended to include the overseas employer, and a person is considered to work for another person if they provide, and are obliged to provide, personal service to that person