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Where Taxpayers and Advisers Meet

CGT Trigger for Share Options (In Employer Company)

MarkC1234
Posts:3
Joined:Fri Mar 03, 2017 8:40 am
CGT Trigger for Share Options (In Employer Company)

Postby MarkC1234 » Fri Mar 03, 2017 8:56 am

Hi

I'm hoping someone with much more tax knowledge than me may be able to shed a bit of light on something I've been scouring the net for weeks....

My better half has various share options granted over a few years in her employers company. (large US listed/Global company)

From the limited info on the employee intranet, it appears as though they only fall under CGT in the UK. (I presume they must be HMRC approved, although it states non qualified if you are a US taxpayer)

My question is, how can we turn the options into cash & make best use of any tax advantages in the UK.

I know she can exercise & sell upto the CGT allowance each tax year with no tax payable. By doing an instant exercise/sale using the US broker & the net cash being released, ready to transfer to the UK

1) What is the actual trigger for CGT? Is it possible to use our own savings to "pay" the option price (ie $70 per share) and then hold the physical shares, choosing to sell up to the CGT limit each year? If we did this, I assume the purchase itself of the options/shares doesn't trigger any CGT? Is it only the actual sale of the shares that determines the date for CGT?

2) If we can buy the shares from the option contracts without generating a CGT charge, I assume we could then transfer some into my name (spouse). Transfers between spouses are exempt from CGT. I would receive the exercise price as the base cost for any CGT calculation (ie $70 per share), then I could sell up to my annual CGT limit with no tax payable?

3) If we can buy the shares from the option contracts without generating a CGT charge, is it then possible to transfer them into an ISA wrapper (up to the annual limit)? the only info I know on this, is that there is a 90 day limit. But I'm not sure if it applies to all shares purchased, including US quoted? Or if applies to shares obtaining from employee granted options?

Sorry for the rather long post, by any help would be greatly appreciated, I've spent hours searching online and don't seem to be able to get to the finer detail.

Many thanks

Mark

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