The appellant’s employment contract as an investment banker with his employer (BNP) was terminated on 18 October 2005.
A compromise agreement between the appellant and BNP included (among other things) the release of shares under BNP’s share incentive plan (SIP). The SIP was not an approved scheme for tax purposes. The appellant was also eligible for 3,000 long dated share options, which were given up as part of a compromise agreement negotiated between the parties.
The appellant’s tax return for 2005/06 did not include tax on the shares received under the SIP. Following an enquiry into the appellant’s tax return, HM Revenue and Customs (HMRC) issued a closure notice stating that further tax was owed because the shares granted under the SIP were taxable income. The appellant appealed.
The issues in dispute were the correct valuation of the SIP shares and whether they should
