Tax implications of selling long term incentive scheme shares

clement0123

Hi there

I am struggling to understand tax implications of selling my long term incentive shares that are about to vest and wondered if someone can help me please.

I have quite a number of shares in the company I work for already. The latest LTI award I was given as part of my bonus 3 years ago is about to vest.

My question is, if I chose to 'sell all' of these vesting shares (as opposed to 'sell to cover' just the income tax and NI) will there be a potential CGT liability? ie should I take the average cost price of all my shareholding in the company as the cost basis (which is significantly lower than the current price and will therefore lead to a gain), or is the cost basis simply the price on the day they vest and they are not considered part of my total shareholding as I will never actually 'own' the vesting shares?

Thanks

Woodstok2000

The cost price is the price when they vest, so if these are the only 'sellable' shares you have, and you sell them all when they vest, there's no cgt impact only income tax.

If you have multiple batches of vested shares, the cost price is the average price at vesting across all the vested shares.

clement0123

Thanks, yes I do have many shares that vested in prior years, so assume your latter point stands (ie I need to take the average price, not the price of the ones that are newly vested). Thanks