Ducati Sporting Club UK > General > Idle Chat > Does this seem right

[Ozz]

Depends if you paid tax when they were granted to you really. If not then they would probably be deducting 22% tax on the entire proceeds.....

....see if that would work out to the missing £500

Although re-reading your post appears they are only passing the profit to you....

[Henners]

What Oz said ... he's my accountant

[beancounter]

Jools, I did exactly what you did a few years ago (US company an' all) and I got the full proceeds (i.e. profit), actually I didn't even get tax deducted, I had to account for that to the Revenue later.

Sounds like a screw up to me.

BC

[Jools]

Thanks for your help everybody, just to clarify a few things that people have asked.

The options are all fully vested now (25% per year over 4 years) so I 'own' them all without any time restriction. The price that I sold them at was confirmed as $37.994 (see, I told you it was as near to $38 as to make no difference). The schedule of brokers charges is very simple and their fees are nowhere near £500 - in fact less than $100.

I have two types of stock option 'approved' and 'unapproved'. The approved ones mean that I have already paid tax on them and I am not liable for any further tax, the unapproved ones mean that I pay 40% tax on the difference between the grant price and the sale price. These were a block of unapproved ones, hence the 40% tax.

The bank swear that no negotiation fee is applied (I've been through that before when someone sent me a dollar cheque).

It all confirms to me that someone, somewhere has cocked up.

I've got a cold at the moment, and unwisely went training last night, so I was too cream crackered to call the broker, but I will now I've got a bit more knowledge.

Ta all

[Ozz]

Jools, if you wanted to email me full details I am happy to look at it for ya (free of course).... u2u me if you do

[Jools]

Well, I've found out what the score is....

When I worked 'in the UK' all the stock options I got were approved (not much use to me because the share price today is nowhere near the dizzy heights of the dot com bubble days so they're all underwater)

When I started working for a World wide team, reporting to managers based in Europe or the US, all the options were unapproved.

This particular block of options was granted after April 1st 2003 which means that at exercise I'm liable to pay, get this...Income tax at the higher rate, Employees National Insurance contributions, plus I'm also liable for Employers National Insurance contributions.

So I get to give the chancellor 48.6% of the gross amount

Is it feckin worth it

[beancounter]

Jools, it could be worse - just listen to "Taxman" by the Beatles (it's on Revolver), George Harrison's rant about paying 95% top rate tax..."it's one for you, nineteen for me...I'm the Taxman"

BC