Leaving work and selling stock options. What tax bracket do I pay?

I leaving my current employer in a few day who I have stock options with. I plan to sell the stock options but would like to know what capital gains tax will I pay on them.
My current tax bracket is 41% but after leaving my employer I plan to be Self employed and won’t be making anything over 20K in my first year. Can I claim tax at 20% when I sell or do I have to pay 41% when I fill out my RTOS form?

Thanks for any help….

Re: Leaving Work And Selling Stock Options. What Tax Bracket Do I Pay?

Difference between exercise price and market value on day of exercise incurs income tax at your higher tax rate in that year. Not sure when you have to pay this by, but if you have to pay the 41% up front, you can get a tax refund for the 21% at the end of the year if your total income (including profit on options) was within the standard rate band.

Difference between exercise value and sale value incurs CGT at 20% -- if you exercise and sell on same day, this will be zero, i.e. there is no "capital" gain for tax purposes.

Re: Leaving Work And Selling Stock Options. What Tax Bracket Do I Pay?

You need to pay at 41% unless you have prior approval from the Revenue Commissioners to pay at the lower rate. If you are currently at the upper rate, I would imagine that they will make you pay as such, and then claim a refund if indeed you don't exceed the SRCOP.

Re: Leaving Work And Selling Stock Options. What Tax Bracket Do I Pay?

MugsGame said:

Difference between exercise price and market value on day of exercise incurs income tax at your higher tax rate in that year. Not sure when you have to pay this by, but if you have to pay the 41% up front, you can get a tax refund for the 21% at the end of the year if your total income (including profit on options) was within the standard rate band.

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You have to pay this tax within 30 days via Form RTSO1 normally. Approved Revenue schemes may have a different tax treatment.

Difference between exercise value and sale value incurs CGT at 20% -- if you exercise and sell on same day, this will be zero, i.e. there is no "capital" gain for tax purposes.

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Exercise value is confusing above - what it should be is the market value at the time of the exercise.

Re: Leaving Work And Selling Stock Options. What Tax Bracket Do I Pay?

jrewing said:

and then claim a refund if indeed you don't exceed the SRCOP.

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Thanks, but what's "SRCOP"?

Standard rate cut off point - the amount of assessable income on which you are charged 20% income tax. Assessable income above this is charged at 41%. Then you deduct your credits from your gross tax to get your net tax figure.