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bigduckontax
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 4416
Experience:  FCCA FCMA CGMA ACIS
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A company share plan was set up in 2010 and each employee was

Customer Question

A company share plan was set up in 2010 and each employee was originally given 20 shares. This plan was set up in France and was vested on Oct 28th 2014, 10 shares were sold by the company to cover the tax liability. I leave not sold the remaining shares 10 shares and have left them in the account managed by a French bank Natixis.
The tax payed on the 10 shares was at 20% plus National Insurance however I'm a 40% Tax payer.
Do I declare this on this year's tax return and if so how?
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. Unfortunately a French plan of this nature will not be approved by HMRC as a share scheme. Accordingly any distributions will be taxed as income in the UK. However, under the Double Taxation Convention between the UK and France the same income stream cannot be taxed in both jurisdictions so any French tax deducted is allowed as a tax credit against any UK tax liability. You should declare any such distributions, if any, as foreign income. I do hope that my response has shown you the way forward.
Customer: replied 2 years ago.

I understand what you are saying however the tax deducted was paid to inland revenue in the UK and this was at 20%. I am assuming I need to pay the additional tax as I'm a 40% taxpayer. Just looking at the online assessment form this does not fall into foreign income. Unfortunately I am no further forward in understanding how to claim this.

Expert:  bigduckontax replied 2 years ago.

You are correct in your surmise that this is not foreign income as it was paid under HMRC arrangements. It would therefore be entered in Box 4 [Other dividends]. You just enter the net amount and when submitted the tax with held will be allowed automatically. On filing HMRC will send you a statement indicating any moneys due to or from the Revenue.

The only precaution here is to ensure that HMRC's statement shows that the tax has been deducted at 20% and not limited to the normal notional 10% dividend level.

bigduckontax and other Tax Specialists are ready to help you
Customer: replied 2 years ago.

Thank you

Expert:  bigduckontax replied 2 years ago.

Delighted to have been of assistance.

Thank you for your support.