Selling vested shares via US broker.... How to work out the CGT and other fees?

jamesd

You can expect a supplemental payslip after exercise. The total of amount paid to you and deductions should equal the exercise profit. You could notify HMRC of your expected income this tax year to get updated tax codes generated.

thomB

jamesd wrote: »

You can expect a supplemental payslip after exercise. The total of amount paid to you and deductions should equal the exercise profit. You could notify HMRC of your expected income this tax year to get updated tax codes generated.

I think I might just do that, not that I expect to be retiring on these shares or anything.

Another problem is getting the dollars over to my UK bank! more loss... :rotfl:

jamesd

You might not have to do that. Some companies take all of the money and send it to you via payroll. Some don't. Depends on your specific scheme.

thomB

jamesd wrote: »

You might not have to do that. Some companies take all of the money and send it to you via payroll. Some don't. Depends on your specific scheme.

I do not work for the company that gave me the shares anymore though so there is confusion from them as to how its going to be handled when i sell these in an hour when it opens

jamesd

It's PAYE income for you so they have to do an extra pay run for you and file the appropriate reporting with HMRC for the income tax and NI. There are probably some other ways to do it but the extra month's pay run is likely to be simplest.

thomB

jamesd wrote: »

It's PAYE income for you so they have to do an extra pay run for you and file the appropriate reporting with HMRC for the income tax and NI. There are probably some other ways to do it but the extra month's pay run is likely to be simplest.

Well to my surprise I have been given the full amount AFTER it was sent to the company and then back to the broker.

The idea being the broker initially sends to the company, the deduct the tax and send the profit back to the brokers account.

I wonder has this happened because i no longer work for that company?

kangoora

Only thing I can think of is someone got confused and decided to treat it as PAYE when is shouldn't have been, maybe!

As far as I am aware share options are subject to capital gains tax and not as PAYE income. Certainly that was how my recent share options were calculated when I cashed them in I.e. Not as PAYE.

So, presumably, they went to run it as PAYE and someone actually realised it shouldn't apply so they sent the whole lot back to the broker. Then, as you've filled out the W8-BEN form the broker didn't deduct any federal tax so just sent you the lot.

Edit reason: oops, just seen Jamesd post about foreign share options taxed as PAYE, I have no idea what happened then unless it was the reverse of the above, for example, your ex-company wrongly assumed it wasn't PAYE
If you've made more than £11k PROFIT, you'll need to declare it to HMRC and pay CGT on that element over £11k.

Disclaimer, this is supposition but I can't see how share options would be treated as PAYE. The whole point of them is you either get given a bunch of shares for nothing as a bonus, or you buy a bunch at pre-determined price and then buy/sell them when they mature - neither to my mind are PAYE income.

thomB

kangoora wrote: »

you buy a bunch at pre-determined price and then buy/sell them when they mature - neither to my mind are PAYE income.

Thats pretty much what happened but just going to call HMRC tomorrow to see if there is anything to do dont fancy seeing a letter after its all spent!