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    Employee shares advice please

    Wife got a letter from a previous employer to say she's got some shares which they have to remove from the scheme due to her no longer working there (left 4 years ago, got letter couple of days ago!). Now the problem is that the letter says that the tax will be calculated on the value 4 years ago, the other problem is that the shares have halved in value since then! So had she been told at the right time (I thought they legally had to remove them therefore they're 4 years late so maybe have some liability?), she would have shares worth more and the tax would be the right amount. Now the tax is too much, the shares are worth far less and she's lost 4 years worth of interest on the money.

    I know that she should treat it as a bonus she didn't realise she was getting but after the drop in value and the extra tax they're next to worthless, whereas if she had been told at the time (legally they had to deal with it at the time?) then they'd be worth alot more.

    I'm going to give them a call but thought I'd check the facts first. Do I have any legal right to tell them that they should re-imburse in some way seeing as it's their fault for not dealing with it at the time?

    Thanks!

    8 Comments

    It depends on what scheme she was on i.e. did she buy 1 share and got 2 free on a month by month agreement/scheme or if they are given completely free as a bonus every year?

    Original Poster

    gal2792t;7808403

    It depends on what scheme she was on i.e. did she buy 1 share and got 2 … It depends on what scheme she was on i.e. did she buy 1 share and got 2 free on a month by month agreement/scheme or if they are given completely free as a bonus every year?



    Just the free ones.

    But if she sells now at a "loss" she will make a capital loss and be able to ofset against tax.

    Original Poster

    virus;7808479

    But if she sells now at a "loss" she will make a capital loss and be able … But if she sells now at a "loss" she will make a capital loss and be able to ofset against tax.



    Tell me more.

    Value 4 years ago about £800, value now about £400.

    The letter says tax will be calculated on the £800 value.

    It depends on the terms of the share scheme. It's a specialist area and you probably need to consult a solicitor with some expertise in share schemes. They don't come cheap so, unless there's a lot of money involved, I suspect that there is little you can do.

    Original Poster

    tony_s1;7808600

    It depends on the terms of the share scheme. It's a specialist area and … It depends on the terms of the share scheme. It's a specialist area and you probably need to consult a solicitor with some expertise in share schemes. They don't come cheap so, unless there's a lot of money involved, I suspect that there is little you can do.



    Is there any free services I can phone?

    I'm mainly just annoyed that they didn't do it at the time and it's cost us around £400. I feel that they should do something about that.

    ring Citizens advice or even business link, They shouild be able to tell you what's going on

    I have shares in my employer and when we want to sell them, we have to pay tax & NI on them at the time we sell them. We can't sell them for 3 years after they were "bought" (or given to us). If we wait 5 years till after the share registration, we can sell them tax free. It's because the shares are then seen as a savings (i guess)

    I would look into it more as you should be paying tax when you do sell them, unless the company "bought" them from you but didn't let you know, and that's why you are being asked to pay the tax on their old value

    Original Poster

    faevilangel;7808725

    ring Citizens advice or even business link, They shouild be able to tell … ring Citizens advice or even business link, They shouild be able to tell you what's going onI have shares in my employer and when we want to sell them, we have to pay tax & NI on them at the time we sell them. We can't sell them for 3 years after they were "bought" (or given to us). If we wait 5 years till after the share registration, we can sell them tax free. It's because the shares are then seen as a savings (i guess)I would look into it more as you should be paying tax when you do sell them, unless the company "bought" them from you but didn't let you know, and that's why you are being asked to pay the tax on their old value



    I understand we have to pay tax on them, I wouldn't mind if they were worth the value they were when we should have got them. It's just that they're now worth half the value but we've got to pay tax on the full value!

    Personally I think they should give them to us in the state they would have been had they done it at the correct time, ie they should give us £800 worth as that's what they were worth when they should have been transferred.
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