Tax implications for companies and employees in relation to employees trading their shares on PISCES
This technical note provides details of the tax implications in relation to employees trading their shares on PISCES, a new type of stock market that will be introduced in 2025.
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The Private Intermittent Securities and Capital Exchange System (PISCES), a new type of stock market, will facilitate secondary trading of private company shares on an intermittent basis. HM Treasury (HMT) will lay secondary legislation in May 2025 to implement PISCES. Trading on PISCES is likely to begin later in 2025.
HM Treasury ran a consultation on PISCES from March to April 2024 and published a summary of responses in November 2024.
Many respondents submitted questions about tax implications for companies and employees in relation to employees trading their shares on PISCES.
This technical note aims to address the questions raised and provide clarity on the tax implications. It sets out the tax consequences:
- when employees acquire shares in the companies they work for
- how the readily convertible asset rules apply
- how PISCES trading windows interact with the tax advantaged share schemes, Enterprise Management Incentives (EMI) and Company Share Option Plan (CSOP)
- when Capital Gains Tax is chargeable
- share valuation rules