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Employee Shares and Market Value

Nigel Doran tax partner at Macfarlanes considers the correctness of the Revenue's answer to a FAQ on market value and personal restrictions
In the Revenue's Frequently Asked Questions on the Taxation of Employment Related Securities published on 2 July 2003 FAQ 1(k) reads: 'Market value is now based on the CGT definition. Does this mean that personal restrictions on the share no longer have to be taken into account in arriving at its value?'. The Revenue's answer is: 'No. Even where there is for example a restriction on sale the shares must be valued as if that restriction would still apply to their hypothetical purchaser. It is the asset (as it is) that is being valued not some other unrestricted asset.' This article considers whether that answer is correct....

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