Employee share schemes - answers to frequently asked questions by employees

20. Are there CGT implications when I exercise rights to acquire shares?

While a CGT event happens when you exercise rights to acquire shares (CGT event C2 cancellation, surrender or similar ending), any capital gain or loss is disregarded. However, when you dispose of the shares you have acquired through the exercise of the rights, you will need to account for any capital gain or loss. See example 15.

Sections within Questions about disposing of shares or rights acquired from an employee share scheme

• 19. Are there CGT implications when I dispose of shares or rights acquired from an employee share scheme?
• 20. Are there CGT implications when I exercise rights to acquire shares?
• 21. Am I entitled to the 50% discount for capital gains on shares or rights I have owned for 12 months or longer?
• 22. Do I have any CGT implications when I allocate my shares or rights to an associate?
• 23. What are the CGT implications when I dispose of shares or rights on which I was assessed on the discount upfront?
• 24. What are the CGT implications when I dispose of shares or rights on which I was assessed on the discount at cessation time?