Taxes Consolidation Act 1997 section 510

Approved profit sharing schemes: appropriated shares

Section 510 sets out the key definitions and tax treatment applying to the appropriation of shares under an approved profit sharing scheme (APSS).

• A participant is not liable to benefit in kind on the appropriation of shares under an APSS, and the initial market value of the shares is determined at the appropriation date or an earlier date agreed with Revenue.
• For capital gains tax purposes, a participant is treated as absolutely entitled to the shares, and any gain accruing to the trustees on appropriation within 18 months of acquisition is not a chargeable gain.
• Where shares were transferred to the APSS trustees from an employee share ownership trust (ESOT), the appropriation is deemed to occur on the day after the shares could first have been transferred by the ESOT trustees.
• Revenue may require any person to provide information within at least 30 days, and the trustees must file a return on or before 31 March in the following year, with penalties applying for non-compliance.