Who do I need to speak to regarding my tax return?
Discussion
I know seems obvious right, but I'm a bit stuck. I have one to do for last year and I'm wondering if I'm missing something obvious.
In that, I crossed a couple of tax thresholds and on top of that received quite a few RSUs and contributed to the ESPP plan along the way. Because of this, the P60 shows rather a large number and unfortunately not enough tax paid in the year. Pension contribs were Sal sacrifice, and there's no benefits on the P11D. I can claim the work from home relief but not a lot else?
The reality of the situation is that I lost loadsamoney on both the RSUs and the ESPP so didn't actually see the "income" that I am now being taxed on. I did sell some of both the RSUs and the ESPP to crystalise the loss as the tech bubble popped.
Now obviously I'm a stoopid fule, but is there any benefit in me speaking to someone to assist me with the numbers to put in the boxes or is it unfortunately as simple as I fear in that I owe the income tax and have a capital gains tax loss to carry forward that will probably never help me?
In that, I crossed a couple of tax thresholds and on top of that received quite a few RSUs and contributed to the ESPP plan along the way. Because of this, the P60 shows rather a large number and unfortunately not enough tax paid in the year. Pension contribs were Sal sacrifice, and there's no benefits on the P11D. I can claim the work from home relief but not a lot else?
The reality of the situation is that I lost loadsamoney on both the RSUs and the ESPP so didn't actually see the "income" that I am now being taxed on. I did sell some of both the RSUs and the ESPP to crystalise the loss as the tech bubble popped.
Now obviously I'm a stoopid fule, but is there any benefit in me speaking to someone to assist me with the numbers to put in the boxes or is it unfortunately as simple as I fear in that I owe the income tax and have a capital gains tax loss to carry forward that will probably never help me?
I’m no expert but think your “fear” is justifiable.
RSU’s from a quick Google are subject to income tax as you say with then CGT losses on your share loss.
You can offset income tax from investments such as VCT’s or EIS but that will entail investing money you may not have spare and may just compound your issues.
Tbh seeking out an accountant is your best bet - the cost of doing all your return should only be a few hundred.
When my company started to dish out share options that was the first year I stopped doing my own tax returns.
Good luck.
RSU’s from a quick Google are subject to income tax as you say with then CGT losses on your share loss.
You can offset income tax from investments such as VCT’s or EIS but that will entail investing money you may not have spare and may just compound your issues.
Tbh seeking out an accountant is your best bet - the cost of doing all your return should only be a few hundred.
When my company started to dish out share options that was the first year I stopped doing my own tax returns.
Good luck.
fat80b said:
I know seems obvious right, but I'm a bit stuck. I have one to do for last year and I'm wondering if I'm missing something obvious.
In that, I crossed a couple of tax thresholds and on top of that received quite a few RSUs and contributed to the ESPP plan along the way. Because of this, the P60 shows rather a large number and unfortunately not enough tax paid in the year. Pension contribs were Sal sacrifice, and there's no benefits on the P11D. I can claim the work from home relief but not a lot else?
The reality of the situation is that I lost loadsamoney on both the RSUs and the ESPP so didn't actually see the "income" that I am now being taxed on. I did sell some of both the RSUs and the ESPP to crystalise the loss as the tech bubble popped.
Now obviously I'm a stoopid fule, but is there any benefit in me speaking to someone to assist me with the numbers to put in the boxes or is it unfortunately as simple as I fear in that I owe the income tax and have a capital gains tax loss to carry forward that will probably never help me?
You would have had to pay tax/NI on the RSus when they vested (so that shouldnt have resulted in an underpayment). With ESPP I'm not sure how you could have been "under-taxed". There isn't any Income tax to pay, you should only have to pay CGT if/when you sellIn that, I crossed a couple of tax thresholds and on top of that received quite a few RSUs and contributed to the ESPP plan along the way. Because of this, the P60 shows rather a large number and unfortunately not enough tax paid in the year. Pension contribs were Sal sacrifice, and there's no benefits on the P11D. I can claim the work from home relief but not a lot else?
The reality of the situation is that I lost loadsamoney on both the RSUs and the ESPP so didn't actually see the "income" that I am now being taxed on. I did sell some of both the RSUs and the ESPP to crystalise the loss as the tech bubble popped.
Now obviously I'm a stoopid fule, but is there any benefit in me speaking to someone to assist me with the numbers to put in the boxes or is it unfortunately as simple as I fear in that I owe the income tax and have a capital gains tax loss to carry forward that will probably never help me?
Countdown said:
You would have had to pay tax/NI on the RSus when they vested (so that shouldnt have resulted in an underpayment). With ESPP I'm not sure how you could have been "under-taxed". There isn't any Income tax to pay, you should only have to pay CGT if/when you sell
I did pay tax/NI on the RSUs and I also paid it on the ESPP through my regular PAYE payslips. The disparity is due to my tax code and the total amount crossing into the top rate tax band (I think). fat80b said:
I did pay tax/NI on the RSUs and I also paid it on the ESPP through my regular PAYE payslips. The disparity is due to my tax code and the total amount crossing into the top rate tax band (I think).
Unfortunately, this is the case and although I'm sure it's cold comfort, know that you are not alone. I'm not aware of any mechanism to alleviate this bar holding onto the shares and hoping they go up.I assume you are employed by a US tech company, RSUs and ESPPs on top of your salary makes it look that way.
As either you or another poster said, your RSU, if a US company are likely taxed at source. I would be very surprised if your ESPP wasnt the same. Since 09 I have worked for 3 US tech companies and all this stuff done at source including when I hit advanced rate tax.
Never used an accountant yet.
If you are registered for self assessment, make sure you complete by the deadline and it will likely show you what the gap is/was. It can be that if your income is variable there will be a few hundred of delta. For one reason or another technically I had 3 employers in 2020 whcih made my return look more complex but as they were all PAYE it was painless.
I am intrigued by your crystallising of losses on RSU. RSUs are a pure gain they are NOT options.
ESPP are similar and assuming your employer offers a discount, say 15%(usual), unless you sold much after the vest date and after some share price tank then not sure how you could have lost much.
By which I mean, for example my companies vest date for Nov 17th and we paid 85% of the lower price on either Nov or May 17th. I was like a kid playing Daley Thompson’s Decathlon on a ZX81…..smacking the sell key violently the day the shares were availble so I effectively got the full 15% discount. My company take any tax from source via the following months payslip
As either you or another poster said, your RSU, if a US company are likely taxed at source. I would be very surprised if your ESPP wasnt the same. Since 09 I have worked for 3 US tech companies and all this stuff done at source including when I hit advanced rate tax.
Never used an accountant yet.
If you are registered for self assessment, make sure you complete by the deadline and it will likely show you what the gap is/was. It can be that if your income is variable there will be a few hundred of delta. For one reason or another technically I had 3 employers in 2020 whcih made my return look more complex but as they were all PAYE it was painless.
I am intrigued by your crystallising of losses on RSU. RSUs are a pure gain they are NOT options.
ESPP are similar and assuming your employer offers a discount, say 15%(usual), unless you sold much after the vest date and after some share price tank then not sure how you could have lost much.
By which I mean, for example my companies vest date for Nov 17th and we paid 85% of the lower price on either Nov or May 17th. I was like a kid playing Daley Thompson’s Decathlon on a ZX81…..smacking the sell key violently the day the shares were availble so I effectively got the full 15% discount. My company take any tax from source via the following months payslip
I am guessing the issue is that you kept the RSU/ESPP stock rather than selling it and it’s worth less than value you paid income tax on.
Not sure there’s a lot you can do unless you have other CGT gains to offset that loss against.
It must have dropped he’ll of a lot for that to be the case.
Not sure there’s a lot you can do unless you have other CGT gains to offset that loss against.
It must have dropped he’ll of a lot for that to be the case.
supersport said:
I am guessing the issue is that you kept the RSU/ESPP stock rather than selling it and it’s worth less than value you paid income tax on.
Not sure there’s a lot you can do unless you have other CGT gains to offset that loss against.
It must have dropped he’ll of a lot for that to be the case.
I did keep the stock and it has dropped quite a bit but I’m less concerned about that (not a lot I can do about it now) Not sure there’s a lot you can do unless you have other CGT gains to offset that loss against.
It must have dropped he’ll of a lot for that to be the case.
I’m more interested in trying to see if there is a way I can avoid giving hmrc another hefty chunk on top.
It looks like my understanding has been confirmed in that there’s not a lot I can do about it now and I’m going to be left writing a cheque to cover the tax difference
The RSU are tax with withholding by US companies can be a “on paper” additional risk if you don’t crystallise when they vest such that if you come to crystallise at later date and the shares are below the vesting value then effectively you have paid more tax than the income tax level. That’s the risk you have - as you know - for holding on to any shares. They can go down as well as up.
I can’t see - now the tax year is past of you reducing your tax bill to below the next tax threshold. You should have paid more into your pension maybe?
I can’t see - now the tax year is past of you reducing your tax bill to below the next tax threshold. You should have paid more into your pension maybe?
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