Tax on Shares

[Mr Gearchange]

I exercised my right to buy stock options for my ex employer when I left them a couple of years ago.
The business was subsequently sold for $7 per share with me having paid $0.5 so I'm getting a bit of a windfall from them. Company is US based and they are just paying the full amount into my bank account.

How much tax am i liable for on this? I had assumed 40/45% in line with income tax depending on my total earnings for this financial year.

Sorry for the noob question - but never benefited from any shares before now.

Thanks

[twinturboz]

Will be capital gains tax of which first £11100 is tax free, after that depending if you are in the basic tax or higher rate income tax bracket 18% or 28%.

[Eric Mc]

If they are going to be subject to Capital Gains Tax, will they not be eligible for Entrepreneurial Relief?

[Mr Gearchange]

Awesome - thats far better than I expected.

[JamieBeeston]

Eric Mc said:

If they are going to be subject to Capital Gains Tax, will they not be eligible for Entrepreneurial Relief?

Most staff fall foul of the 5% requirement here I'd suspect, especially if this is a traded company.

If the OP did have 5% of a traded company then happy days