Share plan taxation

B

bagoftricks

Registered User
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Hi all

Just a quick question for all of you taxation experts.

My company issued me with a non approved share plan. They are a UK based company.

The shares vest at a third a year over 3 years. The first set vest on the 23rd of the month.

These are not share options but outright shares that are been given to me.

What are my tax liabilities in this case?

Is this capital gains or income tax?

Any more information needed to make an informed decision?

Thanks
Bag
 
If it is shares, rather than share options, you declare your income tax on your income tax return for the year in which they vest (so you will make a return in October 2008 for this year, showing these shares).

Your employer will give details of the shares to the Revenue on form SO2, six months after their year end.

The tax is payable in October of the year in question. However, for your first self-assessment year (ie 2007) you can make a NIL payment in October '07 and then pay the tax, together with your preliminary tax for 2008, by 31 October 2008.

The income tax due on the shares will be based on your marginal rate and the market value of those shares at that date. If you dispose of the shares in the future, the base cost for CGT purposes will be the market value on the date they vest.
 
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