TAX Employee Restricted Stock Options vested (Unemployed without benefits or income)

R

Returner

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Hi everyone,

Some years ago I received Employee Restricted Stock Options from the company I was working for, and it was only one year ago that I exercised them. The results of it were the below:

ACCOUNT HOLDINGS

CASH & CASH EQUIVALENTS 3,321.54 (over the years I accumulated the dividends )

RESTRICTED EMPLOYEE STOCK OPTIONS (long-term): WITHDRAWALS & DEPOSITS $3,342.01

Adjusted Gain/Loss = Loss $596,73

NET DIVIDENDS & INTEREST ACTIVITY $20.47



At the time I exercised the options, I was unemployed without any benefits, so I did not have any income.

My question is: Do I have to declare the Cash and Loss to Revenue?

In other countries within Europe, if you do not have income, you do not have to declare this.

Please does any of you know what Revenue says about this matter?

I have read that we must declare any gain within a year, I only have 15 days to declare if any.

If you know where the Revenue website states the non-income scenario and tax obligations, I would appreciate it.

Thanks!!
 
This is a bit unclear.
The snapshot from your brokerage account (I presume?) above doesn't really clarify the relevant details.

Did you get the shares for free?
If so, how many shares and what was the price at the time that you acquired them?
The full value at that point would be considered income and should be declared (unless this stock incentive scheme is subject to some treatment that alters the tax treatment) along with the dividends.

Even if it's under your tax exemption amount based on your tax credits.
Have you disposed of them since or do you still hold them?
 
Thanks, ClubMan,

Hope the below will clarify:

The 192 Employee Restricted Stock Options were given to me as a salary incentive (yes, free. I did not buy anything), this was a (clever?) way my manager decided to increase my salary over several years.
The company already declared it at the time and it shows on the payslip as AIP, Accumulated Income Payment

I do not hold them anymore because I sold all of them in September 2023. As you see in the attachment, the value of those options decreased, total Loss $596,73
The dividends were kept accumulating over the years as Cash with the same brokerage. I disposed of it as well in September 2023.

The brokerage transferred:
  • €3,599.18 Net Proceeds _ Do I have to declare it keeping in mind that there was a loss in value (= no gain) at the time the options were sold?
  • €3,320 Cash
Because I was unemployed without any benefits and that was my only income in 2023, is mandatory to declare all of this?

I have received a notification from the brokerage: IMPORTANT TAX RETURN DOCUMENT AVAILABLE, if I have to declare the transactions, is this the only document to be presented in Revenue? Or should I consider anything else, how do they know there was a loss?

Thanks again,
 

Attachments

  • Adjusted Gain & Lost.docx
    196.6 KB · Views: 36
I'm still confused but this should be the general gist...
  1. Any dividends that you have received are assessable for income tax etc. and should be declared.
  2. If you received shares for free or at a discount then, at the time that you take ownership of them (e.g. they vest in your name and/or are exercised so that you have full control over them) the difference between the market value at the time and the price (if any) that you pay for them is assessable for income tax etc. and should be declared.
  3. If you hold onto the shares and sell them at a later date then the difference between the ultimate selling price and the market price at point 2 is assessable for CGT and there are specific rules about when this needs to be declared and paid.
 
Thank you ClubMan,

1. The dividends I have received from the company will be declared.
  • €3,320 Cash
2. Shares sold on Sept 2023 did not generate gains. There was a loss $596,73 (difference between the ultimate selling price and the market price at point 2). Nothing to declare then in this case.
 
Aren't you missing a third point? What about the benefit in kind, assessable for income tax/PRSI/USC, attributable to acquiring the shares for free?

E.g. say the shares were worth €100 each on the day that you took full ownership of the 192 shares then that's equivalent to €19,200 and this is assessable as if it was regular earned income even though you didn't receive any actual cash at this point. Maybe this tax liability was dealt with through payroll at the time?

You can use the capital loss incurred at a later date by offsetting it against any capital gains. I don't know if you need to file a CGT return to record this loss? I don't think so but I'm sure that this question is addressed in other threads here on Askaboutmoney.
 
Last edited:
The company had already declared the 192 shares over the years through payroll at the time, and they show on the payslip as AIP, Accumulated Income Payment.
The breakdown of the opening and closing transactions is clear; no gains. I can't use the capital loss incurred at a later date by offsetting it against any capital gains because I no longer have any capital gains in Ireland. I am leaving for good.
As it seems gains or loss must be declared.
Thanks for your time!
 
Returner said:
The company had already declared the 192 shares over the years through payroll at the time, and they show on the payslip as AIP, Accumulated Income Payment.
Click to expand...
Ok, so there's no outstanding income tax etc. liability in relation to the acquisition of the shares themselves it seems.
Returner said:
I can't use the capital loss incurred at a later date by offsetting it against any capital gains because I no longer have any capital gains in Ireland. I am leaving for good.
Click to expand...
Ok, that wasn't evident from your posts to date as far as I can see.
 
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