PAYE dispute - restricted securities
I am looking for an expert to support my position regarding PAYE.
I am an employee of a NASDAQ-listed US company. I am UK resident and domiciled and am paid PAYE via a third-party UK payroll company. The company has no UK presence (other than me working from home).
In November last year, I benefited from several transactions in company share plans: stock option exercises and employee stock purchases. All transactions were taxed by my employer via PAYE.
My employer and I have different opinions on the amount of tax that I should pay on these transactions. As things stand, my employer used the same-day adjusted NASDAQ closing share price to calculate taxable gain. I think this is incorrect since the transactions took place during a trading blackout period - a time when employees are forbidden by insider-trading policies from buying or selling any shares. By my reading, quotes below, the shares were "restricted securities".
When the trading blackout was lifted, the open-market value of my acquired shares had fallen (by a few thousand dollars). I believe this lower valuation is the figure that should be used for computing net gain. I have raised this issue with my employer who has refused to adjust PAYE - and I don't think they have taken any expert UK tax advice.
I hope the above makes sense. Some questions for any experts who've taken the time to read my post:
- Is my understanding and application of the "restricted securities" regulations correct?
- If I am correct, what should I do next?
- Can someone here help me, and if so, how much would you charge?
"Employment-related securities, or interests in employment-related securities, are restricted if restrictions have been imposed directly or indirectly by any: contract, agreement, arrangement or condition, and the restrictions have an effect on the market value of the security."
"Typically, a US quoted company will have four ‘black-out periods’. These are periods during which employees are prohibited from dealing in their shares. This blocking period applies to all shares held by relevant employees rather than just to those shares acquired by reason of employment. It could be argued that the restriction that employees cannot sell during four periods would reduce the theoretical market value of the shares."
- Associated disposals - Entrepreneur's relief 134 2
- Merging my businesses 190 3
- Spousal transfer and PPR 553 19
- What shall I reduce payments on account to? 39 1
- Where has Portia gone? 1,938 66
- Deferred Tax Asset & Liability 354 8
- Is it worth being a limited company if already a higher rate taxpayer? 453 8
- Is my client risking reputational damage? 327 9
- Sage Vat return box 2 324 1
- Holiday entitlement 576 11
- transferring from franchisee to ltd comapny 188 4
- Do I have grounds to dispute our accountant’s fees? 464 12
- Performance measurement within accounting practice 317 7
- Capital allowances on taxis 133 1
- Are Sales to Germany considered VAT Taxable turnover for HMRC? 141 2
- New Client wants an Income Certificate for a Mortgage 924 21
- Can i reclaim tax if my fuel cost more than the AFR in a company car 224 3
- Sage line 50 payment before invoice date 208 11
- Best Tax / Accounts Production software 424 10
- Property Purchase in Daughters Name 356 9
- Services via intermediaries and new HMRC reporting requirements 789
- RTI - duplicate employee record 553
- Pensions Regulator 449
- How hard is it to reduce a code? 409
- Sanzar 312
- Portia ... Where art thou 302
- Digital marketing focus group 296
- How do you do it 291
- Kashflow balance sheet difference 269
- Report old income 241