US Stock Options Tax
In Jan 2010 (2009/10 tax year) I was granted a US performance-related stock option with McGraw-Hill. I was employed by McGraw-Hill in the UK. The option measured the stock performance in year 1, and then vested over years 2 & 3. It is being paid out now.
I left McGraw-Hill in Feb 2012 (2011/12 tax year).
The award converts units into shares. However, McGraw Hill in UK has advised HQ in NY that 50% "Foreign Tax" should be applied and the value of the option has been reduced by 50% through subtracting half the shares from the award.
McGraw-Hill says this is correct as I was employed by them at the time the option was awarded (at that time I was in the UK 40% tax band). I am challenging this, as I have had no gain from the award so question how I can be "taxed" in the US. I am also W8-BEN registered in US.
So my questions:
* As I am not an employee of McGraw-Hill, (and haven't been for nearly a year) how can they instruct the US to withhold 50% of my award for tax purposes?
* where will this tax be paid
* What about capital gains tax, which was what I was expecting to pay
And the most important question, how can I get this reinstated?
Thanks for any help.
- Capital allowances or revenue is capital? 85 1
- any implications of this type of transaction 51 1
- How much did you pay for your website 1,686 28
- Sage 50 cost centre limitations 97 3
- What font do you prefer to use for correspondence? 287 11
- Straightforward email correspondence or PDF letter attached to blank email? 1,031 13
- How to post Sales figures in Sage50 Accounts (we use separate Sales ledger) 262 7
- Sage data 105 1
- Course costs for retraining as a barrister 422 9
- Limited company buying a car 362 6
- Funding Circle experience 156 3
- Excel query 121 2
- Do I need to pay my accountant 1,297 13
- Payment on account penalties 131 3
- Tax on free shares 146 5
- Flat Rate Vat 14.5% and 5% reduced rate VAT 208 3
- Capital allowances on sale and puchase of business assets 128 1
- Audit 492 14
- PPR relief and half hectare rule 130 3
- Buying a horse?? 431 12
- CTA study material 805
- Anyone have clients that use Pay4Later to offer customers credit? 496
- Raiders of the Lost Tax File 461
- Employment related securities question 324
- AIM Stocks and IHT 311
- Expat pension contributions? 282
- Tax Relief for overseas employees 282
- Trust for Employee 257
- Service Charge Accountant Career Options 234
- IPP (International Pension Plan) income 161