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Topic: Help? Cashed out stocks now they want 600 pounds?  (Read 1474 times)

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Help? Cashed out stocks now they want 600 pounds?
« on: September 14, 2006, 07:44:20 PM »
Husband cashed out some stocks only worth around 2700.00 dollars now his work is trying to tax him 40 percent on it.  Not only are they wanting to tax him around 600 pounds but they are insisting that it come out of his next check.

I thought this was a bit harsh and that they could atleast take out an extra 100 pounds a month or let him pay at the end of the tax year?  Am I wrong?

Also one of his friends mentioned the capital gains tax?  Any suggestions.

Just to let you know the original problem started with his Human resources dept using his US social security number on all of his stocks and when we cashed out these were uk stocks and now they say he owes this money.


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Re: Help? Cashed out stocks now they want 600 pounds?
« Reply #1 on: September 14, 2006, 10:06:25 PM »
If these were options or restricted stock granted when he was not UK resident then there should be no UK tax due at all.  It doesn't matter that they were UK stocks.

There would of course be US taxes to be withheld so the net after taxes should be similar... :(


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Re: Help? Cashed out stocks now they want 600 pounds?
« Reply #2 on: September 15, 2006, 09:14:37 AM »
did he transfer/bring this $2700 to the UK?  (did he remitt the funds to the UK?)
If you harbour bitterness, happiness will dock elsewhere.


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Re: Help? Cashed out stocks now they want 600 pounds?
« Reply #3 on: September 15, 2006, 10:23:40 AM »
Elizabeth,

If the options were granted while he was UK resident, they are supposed to withhold 40%.  If the options were granted before he became resident, no tax is withheld. 

Assuming they were granted in the US, follow Guya's advice. 

Assuming they were granted in the UK, then if they screwed up and gave it to him without withholding the tax, they have to still pay the tax now; which is why they want him to pay now.  A nice company would let him pay them back over time; a nasty company won't.  Most companies will arrange for small employee loans in emergencies (for example, advances of salary to help an employee through a rough spot).  He should arrange for a company loan if he doesn't have the £600 to hand.  The company should honour the request as it is their fault that they did not withhold the tax.
Liz Z i t z o w, EA
British American Tax


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Re: Help? Cashed out stocks now they want 600 pounds?
« Reply #4 on: September 15, 2006, 09:06:23 PM »
These were stocks he was given by the company because he has worked with them for so long.
When we cashed them out we were told by his company HR dept to use his Social Security number that he obtained while in US.  He recieved and sold the stocks while in the uk and now a week later they want 600 pounds .  Why do they need it right this second?  I mean in USA you would just pay at the end of the year?

If it is their mistake they should be willing to work with him.  But no they want the full amount right now this paycheck what is the rush?


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Re: Help? Cashed out stocks now they want 600 pounds?
« Reply #5 on: September 15, 2006, 09:46:46 PM »
There is NO UK tax due because these relate to the long period of time he worked for the company, but not in the UK.

The payroll are wrong in thinking that UK tax should be withheld.  A professional tax adviser could talk with them on your behalf, but then you'd spend most of the £600 on tax advice!


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Re: Help? Cashed out stocks now they want 600 pounds?
« Reply #6 on: September 16, 2006, 12:00:52 AM »
He worked in UK, Norway and US since he has been with the company.

I was under the impression that he was allowed a capital gains of like 5000 pounds a year?

I need a good tax accountant but not sure of one in Aberdeen Scotland anyone have any suggestions please message me.


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