US RSU - Managed by Fidelity - Strange Process - Need clarity on CGT calculation

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I have seen many posts on RSU CGT calculation.

Typically, let's say the company gives 10 shares, and they vest after 1 year.

Upon vesting they hold off shares/tax for PAYE, USC etc. - if you decide to sell the same day mostly no CGT unless stocks swayed in a big way.

If you instead decide to sell at a future date, then you have to pay CGT for the gain made from vesting date subtracting the annual exemption allowance.

Above is all clear to me - however my RSUs are charged differently.

Upon vesting, no shares/tax is withhold. Only when I sell the tax is withheld and shows up in payroll.

So, if I sell in a future date after vesting, I'm being charged for tax only on the sell date instead of the vesting date. And fidelity statements don't show the vesting date.

That brings me to the confusion - does it mean technically I'm not liable for CGT at all with the way my statements/charges work?

How will Revenue know when my shares vested if they are not showing in payroll/fidelity statements.

I would like to file for CGT return but confused on how to declare it properly.
 
Private said:
I have seen many posts on RSU CGT calculation.

Typically, let's say the company gives 10 shares, and they vest after 1 year.

Upon vesting they hold off shares/tax for PAYE, USC etc. - if you decide to sell the same day mostly no CGT unless stocks swayed in a big way.

If you instead decide to sell at a future date, then you have to pay CGT for the gain made from vesting date subtracting the annual exemption allowance.

Above is all clear to me - however my RSUs are charged differently.

Upon vesting, no shares/tax is withhold. Only when I sell the tax is withheld and shows up in payroll.

So, if I sell in a future date after vesting, I'm being charged for tax only on the sell date instead of the vesting date. And fidelity statements don't show the vesting date.

That brings me to the confusion - does it mean technically I'm not liable for CGT at all with the way my statements/charges work?

How will Revenue know when my shares vested if they are not showing in payroll/fidelity statements.

I would like to file for CGT return but confused on how to declare it properly.
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On further research - I found out that mine is under Special Tax 83(b) election - On Vesting - No tax consequence. Vesting does not trigger inclusion in income of any appreciation in value of shares; no further tax until sale or other disposition.
 
Private said:
On further research - I found out that mine is under Special Tax 83(b) election - On Vesting - No tax consequence. Vesting does not trigger inclusion in income of any appreciation in value of shares; no further tax until sale or other disposition.
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You'll need to go back to your company to figure out just want is going on with your scheme. What does the information you were provided with when you signed up to the scheme say in relation to the taxation events?
 
Fidelity is a common platform for share schemes. They do apply Irish taxation if required i.e. apply 52% tax on vesting. So it is technically not an issue on Fidelity's side.
 
From Revenue, you should be paying tax on the date of vesting, so suggest it is an incorrect process on the fidelity / employer side.

Share-settled RSUs​

You must pay Income Tax, USC, and PRSI on the market value of these shares at the date of vesting.

You will be charged tax on the vesting date or on the date the shares pass to you, if earlier. Your employer will make the necessary deductions through payroll and pay the tax directly to the Collector-General.

RSUs are fully taxable if they vest at a time when you are Irish Tax Resident. The benefit cannot be apportioned by reference to any part of the vesting period during which you were resident elsewhere.

If you are not tax resident at the time of vesting, then you will not be liable to Irish tax on the benefit.
 
My U.S. multinational company also offers RSU through Fidelity. All the taxes (52%) are taken at source and dealt with payroll. This will be reflected on the payslip the month after. All companies are obliged to deduct RSU taxes at source via payroll when they vest. If you keep the shares after the vesting date, you have to pay the CGT on any gain made after the vest date (if any)
 

Restricted Stock Units (RSUs)

The page explains about taxation of Restricted Stock Units (RSUs)
www.revenue.ie www.revenue.ie

Cash-settled RSUs​

You must pay Income Tax, USC and PRSI on the cash payment received by you. Your employer will make the necessary deductions through payroll and pay the tax directly to the Collector-General.
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Revenue do list Share-settled RSUs and Cash-settled RSUs(?) - I'm only familiar with Share-settled.

They don't specifically state Cash-settled is also based on tax on vesting date - but Revenue website information can be unclear. Initially I thought your company must be making a mistake - but reading Revenue - I'm not sure.

(In regards to the question of how will Revenue know when the shares have vested, your company (not Fidelity) is obliged to send that information to Revenue. )
 
klaus-v said:
All companies are obliged to deduct RSU taxes at source via payroll when they vest.
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I seem to remember that thus rule just came in this year or last year. Do you have any authoritative source on it like revenue or even better a newspaper article? I wasn't able to find one when I looked recently.
 
Moolahasker said:
I seem to remember that thus rule just came in this year or last year. Do you have any authoritative source on it like revenue or even better a newspaper article? I wasn't able to find one when I looked recently.
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The recent change was for ESPP/options. RSUs were pushed to payroll 13 or so years ago so it's harder to find sources on it. Also it wasn't a high profile news story partly as the Irish economy was collapsing at the time.

This makes some mention of RSU + payroll mainly in reference to foreign tax, but it would be related.

Taxworld Ireland - Irish Tax Law Legislation online - Intelligent tax technology

www.taxworld.ie www.taxworld.ie
 
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