CGT on sale of stock options - what's the purchase date?

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Persius

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Hi all

Hope someone can help me here, or point me in the right direction.

In 2002, my employer gave me 2000 stock options in the company at €9.00, which was the market value at the time. Now I had to wait a few years before I was allowed to actually purchase/sell them (before the options vested?). Anyway, I sold them this year for €12.00. What I did was purchase them (or exercise the option?) and immediatly sold them on at the current market value.

Now, I received the full sum of about €5900 from the administrator of the stock options (i.e. €6000 less costs but no CGT deducted). So I have to make a CGT return myself. When reading the revenue leaflets on this, it says that you can apply "indexation multipliers" to work out the purchase cost if the purchase was in 2002 or before.

In my case, where I was granted the stock option in 2002, can I apply the Indexation multiplier to reduce my CGT liability? Or is the relevant date 2007, as I made the actual purchase in that year?

Thanks in advance for any pointers.
 
If exercised them and sold them on the same day then you are not liable for CGT however you may be liable for [broken link removed]
 
There is no CGT on same day sale. The option gain is treated as income, so its taxed as income. By Revenue rules the tax was due within 30 days of the transaction. Tax = (Market Price - Option Price) * Marginal tax rate (e.g. 41%). Go to www.revenue.ie and search for RTSO. I am assuming that this is an "unapproved" share option scheme ... as the majority are.
 
Hi,

Similar question, i.e. shares exercised and sold immediately, therefore I understand no CGT liability.
RTSO paid in full within 30 days, and tax paid receipt received from revenue, Now over two years later Revenue are sending me a letter asking me to fill out a form 11 ( Pay and File Income tax return for 2006) for these same options, saying "if the shares or assets have been disposed of", I should fill in the CGT panel on form 11.

Now clearly thet are disposed of, however not liavble for CGT, What should I fill in in this section of the form 11?

Thanks for any advice
 
It is (or at least was) the case that having a certain amount of (nominal) income subject to income tax resulted in one becoming self assessed for a period thereafter. You are supposed to make the Form 11 return as requested. You can just put in NIL for the CGT liability and annotate this or attach any explanatory notes if necessary to explain why.
 
Thanks Clubman,

Just now been reading "Explanatory Leaflet IT 72" from revenue site
Tax treatment of shares acquired by employees and directors under
Unapproved Share Option Schemes.

It says at the end of section 5.2 that

The RTSO paid may, however, be used to satisfy the individual’s overall income tax liabilityfor the tax year (i.e. it can be credited against the individual’s final income tax liability including the liability relating to the gain on the exercise of the share option).

Now the CGT section of Form 11, [801 (a) Shares/Securities] just allows a value to be filled in for the Aggregate Consideration, so not sure I can put nil here, I am thinking I do actually put in the amount of the gain on the excersise/disposal, they will then calculate CGT and offset the RTSO payment against it?

Or am I confusing myself here?

Cheers
 
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