Taxation on employee share sale at IPO

[airedailleurs]

Hi, I'm in the fortunate position of having bought a substantial number of shares in a company I used to work for, for almost nothing. Can anyone tell me how the profit from the sale of those shares is taxed after the company's IPO? IPO will be in London.

20% CGT

Irrespective of amount of capital gain?

I think there's usually 11k of annual allowance on the gain, which is tax free. If you have a spouse you can transfer items between husband and wife without a capital gain tax so that can gain you an additional 11k gain tax free. You could also potentially sell the shares over several years, if that's possible to make use to the gain?

Then gains are usually 10% up to the basic tax threshold, 20% after.

There are some options around reinvestment reliefs I think, but you'd have to be investing in particular schemes and would need to talk to someone properly qualified I think about those.

Looks like I'm a little out of date £12,300 tax free allowance on capital gain

Really helpful thanks. Yes I did think of spreading out the sale of several years. Nice problem to have!

I don’t suppose you bought the shares under any particular employee share scheme such as save SAYE etc?

@ForensicAccountant

I don’t suppose you bought the shares under any particular employee share scheme such as save SAYE etc?

Not to my knowledge, would that be more tax-efficient?