Bosses called to war could lose tax perks
The Treasury has admitted it does not know if bosses called out as reservists for a war in Iraq will lose tax perks under a key share incentive scheme.
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Paymaster general Dawn Primarolo said: ‘I will be asking my officials to consider whether any issues may arise.’
She had been asked in the Commons by Tory MP Oliver Herald whether periods of service as an armed forces reservist count as periods of continued employment in a taxpayer’s main job for the purposes of the favourable tax treatment given to the share option scheme, the Enterprise Management Incentive.
Heald, who demanded a statement, also asked if any other favourable tax treatment available to taxpayers in continued employment would be lost to them during periods of service as reservists.
Primarolo admitted: ‘The Enterprise Management Incentive rules dealing with employees’ working time do not cater specifically for periods of service by armed forces reservists.
‘Normally this will not cause difficulty in determining an employee’s eligibility to the tax advantages available under EMIs.’
She added: ‘I am not aware of other instances where favourable tax treatment will in practice be lost.’
