Is there now no requirement to put a market value on shares issued to directors on form 42?
If so how do HMRC pick it up?
Is it up to the director to include it on his Tax Return as a benefit?
ADS
Replies (2)
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form 42
there is no longer a requirement to declare on Form 42 shares issued to directors when most companies are first incorporated.
if the company is in existence and a director is offered shares then this must still be declared on Form 42 (even if at market value). this gives HMRC opportunity to dispute the share valuation.
as far as I'm aware, if the shares are provided to the director at below market value then the company must deal with the difference through PAYE (unless the shares are restricted and the relevant election has been made).
I'm not expert in this area but no doubt others will provide a more comprehensive reply if needed.