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Hi Shasta,

Hope you have a moment to look at the following query.

If have two accounts, the first registered as a <Capital Acc>, and the second as a <Trading Acc>

If I then hold headshares of company X in my <Trading Acc> which then issues a set of free options in company X, I would then have two possibilities:

(a) exercise the options on or close two the expiry date (assuming they are in the money)

(b) At some point before expiry, sell the options for cash etc

In the case of (a) are there any tax implications simply due to the exercise process ?

In the case of (b) what will be the tax implications of the sale of the options ?

Finally, what would be the tax situation if the headshares and options were held in the <Capital Acc> ?

Your response to the above would be most appreciated.

Many thanks,

Zorba