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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15975
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I work for a US company that is privately owned. I have share

Customer Question

I work for a US company that is privately owned. I have share options that are fully vested and are about to be exercisable as the company is taken over.

I have been informed that the options when 'cashed in' will be put into my payroll and therefore taxed in the usual way.

My question is whether I can get the money in a different way, other than my payroll, so that I can lower the tax burden as this would make my salary close to £200k for the year and therefore in the top tax bracket..
Submitted: 3 years ago.
Category: Tax
Expert:  TonyTax replied 3 years ago.



As far as HMRC are concerned, there are two types of company option scheme, approved or unapproved. Since your scheme was probably designed for the US tax regime, it will almost certainly be an unapproved one as far as UK tax is concerned and that's why your gain will be taxed through the payroll as you will read here. There is really no way around that if you want the cash.


In some situations it is possible to swap the options the employee has in the company being taken over for options in the company doing the takeover. You'd have to discuss that with your share option plan manager.


I hope this helps but let me know if you have any further questions.