RSU stocks with U.S. brokerage firm

S

stefanop

Registered User
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Hi all,

So last week the company I work for (a U.S. multinational) assigned me some RSU stocks that will vest in June 2019 and gave me the instructions on how to open a brokerage account with a U.S. brokerage firm, which I did online yesterday.

One of the steps was to also fill out the W8-BEN form indicating country of residence, tax ID and country of citizenship, address etc.
Once submitted the account was opened.

Now I’m a payee individual with one income only time so normally don’t do any tax returns. I did some research and it looks like I will only have to pay the income tax and do the return after the vesting period, so I will not worry about that until 2019, hope to be still around :) . However I read somewhere that one has to declare a foreign bank account when opened.

I wonder if a brokerage account which is an account that has specifically been set up only to hold the shares until the vesting period has to be declared when and where ? This is not a normal bank or trading account but just a brokerage account.

I asked about 20 different colleagues who received RSU stocks in the past and also at the same time as me and none of them really none of them has declared it or was aware of this or had any clues. Some looked at me as if I had horns. Some told me they just paid the tax once they vested and exercised the RSU options and that's it. They were never contacted by Revenue afterwards.

Does anyone know if brokerage accounts need to be declared or is it just the foreign bank accounts trading accounts that need to? What are the implications of not declaring a brokerage account but paying the relevant taxes when due?

Thanks

Seamus
 
I asked Revenue this earlier this year. They gave me a very wishy-washy answer. As far as I'm concerned, a brokerage account is not an "offshore account" in the sense of holding any cash on deposit, or anything other than what you will -- as you say -- declare when it's disposed of. HOWEVER, seeing as Revenue have been sending out dire warnings to declare all offshore accounts and there is a potential €4,000 fine for not doing so, it is better to err on the side of caution. See this long thread about the saga:

https://www.askaboutmoney.com/threads/revenue-clampdown-are-us-shares-an-offshore-asset.202664/

Even so, I only bothered to declare it because I return annual returns on Form 11 and didn't want to send one with no declaration. (Form 11 has a space for declaring foreign accounts). If I were you and you are PAYE only and don't make annual returns, I probably wouldn't bother. I don't even know how you would do it. But unfortunately, I'd also say: don't rely on random advice from the internet.
 
Hi Dub_Nerd , thanks for the feedback and for posting the link. I read the (long) previous thread. I don't think I will bother to declare it. Note that this brokerage account that I opened is not even a trading account per se, I cannot buy or sell any shares, I cannot deposit or withdraw any money I can only see my profile, the number of RSU allocated that I can exercise in June 2019 (if the vesting conditions are met) and some other PDF documents, then I have the option to transfer the shares (or cash) somewhere else after the vesting period.

We also got a document from the internal HR office that talks about their taxation etc. but there is no indication that we have to declare the brokerage account. Also I would say that if I declared this brokerage account I would probably be the only one in Ireland. I work for a large multinational and none of the people I asked ever bothered declaring it even if everyone said they paid the tax once they exercised them. I'm sure it will be the same with other U.S. multinationals operating in Ireland.

Thanks again
Seamus
 
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I'd declare the U.S. brokerage account - the Revenue have become obsessive about anything offshore in the last year. You can register for income tax, make your disclosure and then de-register. Regarding the tax on RSUs this should be deducted through the PAYE system and you don't have to do anything and this is probably why your colleagues haven't heard about this.

There is all manner of information exchanged between tax authorities now - CRS (for Europe) and FATCA for the U.S. so there is the chance they will get a notification about your account opening in any event.
 
Thanks Dublin67 for the additional feedback and clarification with regards to the tax being deducted by the PAYE system. I will do some further research and maybe mail Revenue with the same question that Dub_Nerd asked back earlier in the year and see if I get a more clear answer. From what I see I think you suggest that I would need to submit Form 11 so having opened the account in November 2017, I think I have time until the 31st of October 2018 to submit it. Am I right ? Also I wonder if when submitting the form, I can fill out the personal details section and the section related to the opening of a foreign account only, or will also have to fill out all the PAYE sections in the form ? If that’s the case I would need to do a lot of reading or get help from an accountant as I have no experience with that so far. Also another thing is that the field asks to enter the “Amount of money deposited on opening the account” but sure I have no money deposited in the account, but just the number of potential shares that I would avail in June 2019 (if I don’t leave the company before……and another few clauses).

Thanks
Seamus
 
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