How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask TonyTax Your Own Question
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15979
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
Type Your Tax Question Here...
TonyTax is online now

I work for an American company floated on the Dow Jones. I

This answer was rated:

I work for an American company floated on the Dow Jones. I receive stock options every year. I am able to transfer some if these shares, once purchased at the option price, to my wife.
My question is this: is she liable to Capital gains tax on any profit made after selling them, or am I liable for anything over my personal threshold as they were originally mine?

If assets are transferred between husband and wife who are living together or the parties to a civil partnership who are living together, the recipient (of shares in this case) takes the cost of the asset to the donor as their own. In effect, the transfer is done on a no gain/ no loss basis so no gain or loss will arise until the shares are sold by the new owner.

The cost of the shares will normally be the price paid for them in the case of an HMRC approved share option scheme or the sum of the price paid for the shares and the amount on which income tax and national insurance contributions are paid in the case of a an unapproved share option scheme which most US schemes are as far as HMRC are concerned.

I hope this helps but let me know if you have any further questions.
Customer: replied 3 years ago.
Thanks, XXXXX XXXXX I've got, I exercise stock options and sell the resultant shares gaining a profit of up to £10,900 and pay no Capital Gains Tax. I exercise a similar amount of options, transfer the shares to my wife and she sells them, gaining a profit of up to £10,900 and she pays no Capital Gains tax either.....correct?

That's correct. There is no gain or loss on the transfer of shares to your wife.

TonyTax and other Tax Specialists are ready to help you
Customer: replied 3 years ago.

Excellent info - thanks Tony

Thanks for accepting my answer.