Should I Invest In My Company ?

[Beach Hut]

We have been offered a share option scheme at work either secure and guaranteed investment back in 5 years or alternatively a more risky one with 20% discount, dividends if paid but the price could fall.

Should I go for it or not ?

Anyone else invested and the onus is on me to provide the lump sum.

Controversially could my money invested be used for future investment ?

 

[El Presidente]

Depends on line of business. I gave one of my ex-students a reference two years ago and advised her to go for the options available in her company, and she is now sitting on a £2million profit...........which is nice

 

[empire]

 

[Bozza]

Depends on line of business. I gave one of my ex-students a reference two years ago and advised her to go for the options available in her company, and she is now sitting on a £2million profit...........which is nice

£2m profit on options in 2 years?!?

What's the company?

 

[HampshireSeagulls]

£2m profit on options in 2 years?!?

What's the company?

Selling munitions to the US Army! Or cluster bombs to the Israelis......

 

[Bob!]

I've been in a Sharesave scheme at work for many years now.

The way mine works is that you save a set amount a month for 3 or 5 years.

The money is held in a (Lloyds TSB) savings account that the Company can't touch.

At the end of the term you decide whether to take the money (plus interest), or to use that money to buy shares at the price quoted at the start of the saving period. Obviously, if the share price has gone up most people would buy the shares (you can sell them straight away) and make a profit.

If it's that sort of scheme, you can't lose.

 

[London Irish]

Selling munitions to the US Army! Or cluster bombs to the Israelis......

CKR's firm of agents?

 

[HampshireSeagulls]

CKR's firm of agents?

Get real. It was only £2M.......

 

[Beach Hut]

I've been in a Sharesave scheme at work for many years now.

The way mine works is that you save a set amount a month for 3 or 5 years.

The money is held in a (Lloyds TSB) savings account that the Company can't touch.

At the end of the term you decide whether to take the money (plus interest), or to use that money to buy shares at the price quoted at the start of the saving period. Obviously, if the share price has gone up most people would buy the shares (you can sell them straight away) and make a profit.

If it's that sort of scheme, you can't lose.

But the trouble is you are subject to tax and NI on the profit.

 

[Gully]

My brother worked for a company a few years ago, took their share option and topped it up whenever he could afford to, don't mind admitting that he made a tidy profit...I, on the other hand invested in one of their rivals...and lost the lot.

 

[Guinness Boy]

Depends on line of business. I gave one of my ex-students a reference two years ago and advised her to go for the options available in her company, and she is now sitting on a £2million profit...........which is nice

I have no advice for Beach Hut but I do have a story that happened to a friend of mine that puts El Pres' story in to context.

A friend and colleague of mine was one of the people that were the first employees in my company. They had a small shares and investments club going on. The time was the 1980s.

My friend made a nice little bit from the club, a few thousand Canadian dollars but had just proposed to his girlfriend. At the same time the guy who ran the share club left. He advised everyone to take everything they had made in the club and invest it in to one particular young company. His advice was to just buy the shares and leave the money for as long as possible. However my friend had other ideas and instead cashed in his club stock, paid for his wedding in cash and bought a nice looking watch with the change.

The company his friend had recommended was called Microsoft and had he followed the investment advice his few thousand Canandian would now be worth 1.75 million.

He still has the watch which he calls his 2 million dollar watch. Despite my pouring copious amounts of Taiwan draft and Ameretto (not always in the same glass) down his throat I have still to this day not found out what he calls his wife....

 

[Beach Hut]

Depends on line of business. I gave one of my ex-students a reference two years ago and advised her to go for the options available in her company, and she is now sitting on a £2million profit...........which is nice

We are allegedly Europes 3rd largest IT company.

I really don't understand why the profit is subject to tax and NIC contribution on my salary after the five years of any profit.

If invested then a huge tax payment might alert my old friend the tax man who I finally got off my back a few years back.

Does anyone know why it is not just subject to Capital Gains Tax (if applicable) ?

 

[nail-Z]

But the trouble is you are subject to tax and NI on the profit.

Not so - just Capital Gains if you sell them.

At least that always used to be the case.

 

[Beach Hut]

Not so - just Capital Gains if you sell them.

At least that always used to be the case.

The offer clearly states profit will the subject to tax and NIC which makes it appear a hybrid sort of version. CGT is applicable to profit of shares so this make me very suspicious to say the elast.

 

[nail-Z]

We are allegedly Europes 3rd largest IT company.

I really don't understand why the profit is subject to tax and NIC contribution on my salary after the five years of any profit.

If invested then a huge tax payment might alert my old friend the tax man who I finally got off my back a few years back.

Does anyone know why it is not just subject to Capital Gains Tax (if applicable) ?

I thought it was the executive schemes that were subject to Tax & NI (those that are given for Free, where you can exercise your options to sell but only keep the profits), and Share Option schemes (where you pay for shares monthly over a period of x years) were Tax & NI free if held for the duration of the scheme. It was a Government initiative to get people to invest in their own future - or summink...

 

[SussexHoop]

If it's a revenue approved scheme and you take the shares, I believe it is only subject to Capital Gains Tax. Not sure what happens if you take the cash (including interest) instead of the shares.

 

[Beach Hut]

I thought it was the executive schemes that were subject to Tax & NI (those that are given for Free, where you can exercise your options to sell but only keep the profits), and Share Option schemes (where you pay for shares monthly over a period of x years) were Tax & NI free if held for the duration of the scheme. It was a Government initiative to get people to invest in their own future - or summink...

This is not a deduct at source deal you put up a lump sum with two options.

 

[nail-Z]

The offer clearly states profit will the subject to tax and NIC which makes it appear a hybrid sort of version. CGT is applicable to profit of shares so this make me very suspicious to say the elast.

That's a shame - not nearly as attractive as it used to be then.

Our company are doing a SIP, which is effectively a buy 1, get one free. You pay up to £125 a month out of pre-tax salary and actually buy shares on the market. The employer also matches this, and holds them in trust, which are yours after 2 years.

All shares held for 5 years can be sold free of Tax and NI. Best decision I ever made to max out on it, as it's been going for 4 years, 5 months, and the share price is about 3 times what it was when I started. Should boost my income by £1k a month from May next year...

 

[Bozza]

That's a shame - not nearly as attractive as it used to be then.

Our company are doing a SIP, which is effectively a buy 1, get one free. You pay up to £125 a month out of pre-tax salary and actually buy shares on the market. The employer also matches this, and holds them in trust, which are yours after 2 years.

All shares held for 5 years can be sold free of Tax and NI. Best decision I ever made to max out on it, as it's been going for 4 years, 5 months, and the share price is about 3 times what it was when I started. Should boost my income by £1k a month from May next year...

Casino here we come...

 

[Beach Hut]

Casino here we come...

Oh dear......................