how many shares?

[k979aaa]

Value now £2k , october 2018 value = £0 . Now this scenario looks familiar

I was wondering how long someone would come up with this.

[fishtank]

As for after 3 years you would have to pay tax but if this is lower than your capital gains tax threshold of £10,900 does this not count. I am sure most posties don't use there tax free allowance every year. Please correct me if I am wrong

No.
Because they were given to us by our employer they are classed as income until the 5 years is up and therefore the original allocation value would be subject to income tax.
Any gains made above this would be subject to capital gains rules.

[cloherty1976]

As for after 3 years you would have to pay tax but if this is lower than your capital gains tax threshold of £10,900 does this not count. I am sure most posties don't use there tax free allowance every year. Please correct me if I am wrong

The rules for SIP's are that the free shares are effectively part of your pay until the 5 years is up, so you may have to pay income tax & NI if you leave or sell within the 3-5 year period. You don't pay tax or NI if you leave for 'good reasons' anytime during the 5 years.

CGT is only potentially payable when you sell the shares, and then only if your total capital gains for the tax year in question is over the limit, which is £10,900 for 2013/14.

I hope I've got that right and makes sense.

I thought it would be something like that but glad you clarified it. On my rental properties I used to think you could earn up to the £10,900. I got a letter from the taxman saying it was part of my income and had to pay up.

[fishtank]

On my rental properties...

You're a real man of the people cloherty.

[cloherty1976]

As for after 3 years you would have to pay tax but if this is lower than your capital gains tax threshold of £10,900 does this not count. I am sure most posties don't use there tax free allowance every year. Please correct me if I am wrong

No.
Because they were given to us by our employer they are classed as income until the 5 years is up and therefore the original allocation value would be subject to income tax.
Any gains made above this would be subject to capital gains rules.

So we owe the taxman about £400 on basic rate tax then. Plus anything over £10',900 at 18% if I have got that right. I'll keep them in a box for 5 I think.

[cloherty1976]

On my rental properties...

You're a real man of the people cloherty.

Nothing wrong with working hard

[daveyeff]

Looks like some are blinded by a few shares and are not that bothered by the big picture.....am I wrong?

thats exactly what i was thinking.

[chrisj]

Sadly the corrupt financial system continues to allow the big players to take massive profits out of Privatised public companies...

The private investor (joe public) will not receive the shares for about a week after the start of trading when the shares wuld have stabilised a bit from the initial high.

If this was limited (protectionism and illegal of course) to just pension funds or other useful fund managers then one can understand but the system allows foreign investors and hedge funds to cream 'off' some of the profits.

Anyhow, the value of the free shares is somewhat irrelevant at this stage. The real deal is that 5-7% of £2000 (average) is a tidy sum - and that is the guaranteed Dividends.

[OnAFlyer]

Certain red braces wearing city boys are predicting a high of around £4.15 on the opening day which might value your shares at as much as around £2,700 but it will just be phantom money again to the majority of us since we can't touch them until october 2016 at the earliest and october 2018 if you don't want to pay tax.

Any prediction on their value then anyone?

As ours will be valued on the price after the first day of trading, and assuming they launch at the upper price of £3.30 (which seems very likely) then I am hazarding a guess that they will be worth £2,400-£2,600 when allocated to us.

If you sell them after 3 years you only pay tax on the lower amount of the values when they were allocated or when you sell. So if you get 2.5k worth and sell at 3.5k you only pay tax on the lower amount.

Of course you'll still get muppets on here claiming they'll disappear like colleague shares, unable to tell the difference between actual shares on the stock market and a phantom share scheme. Funny how so many are claiming they're worthless but haven't turned them down eh?

[chrisj]

SIPs are enshrined in law... They are not colleague shares and since less than 400 have opted out, the people banging on should wind their neck in.

Privatisation is bad but making money is not!

[P13]

Certain red braces wearing city boys are predicting a high of around £4.15 on the opening day which might value your shares at as much as around £2,700 but it will just be phantom money again to the majority of us since we can't touch them until october 2016 at the earliest and october 2018 if you don't want to pay tax.

Any prediction on their value then anyone?

As ours will be valued on the price after the first day of trading, and assuming they launch at the upper price of £3.30 (which seems very likely) then I am hazarding a guess that they will be worth £2,400-£2,600 when allocated to us.

If you sell them after 3 years you only pay tax on the lower amount of the values when they were allocated or when you sell. So if you get 2.5k worth and sell at 3.5k you only pay tax on the lower amount.

Of course you'll still get muppets on here claiming they'll disappear like colleague shares, unable to tell the difference between actual shares on the stock market and a phantom share scheme. Funny how so many are claiming they're worthless but haven't turned them down eh?

If the company is bankrupt or re-nationalised within the next 3 years then the shares will be worth nothing

[hantsman]

Certain red braces wearing city boys are predicting a high of around £4.15 on the opening day which might value your shares at as much as around £2,700 but it will just be phantom money again to the majority of us since we can't touch them until october 2016 at the earliest and october 2018 if you don't want to pay tax.

Any prediction on their value then anyone?

As ours will be valued on the price after the first day of trading, and assuming they launch at the upper price of £3.30 (which seems very likely) then I am hazarding a guess that they will be worth £2,400-£2,600 when allocated to us.

If you sell them after 3 years you only pay tax on the lower amount of the values when they were allocated or when you sell. So if you get 2.5k worth and sell at 3.5k you only pay tax on the lower amount.

Of course you'll still get muppets on here claiming they'll disappear like colleague shares, unable to tell the difference between actual shares on the stock market and a phantom share scheme. Funny how so many are claiming they're worthless but haven't turned them down eh?

If the company is bankrupt or re-nationalised within the next 3 years then the shares will be worth nothing

That wont happen.

[fishtank]

Certain red braces wearing city boys are predicting a high of around £4.15 on the opening day which might value your shares at as much as around £2,700 but it will just be phantom money again to the majority of us since we can't touch them until october 2016 at the earliest and october 2018 if you don't want to pay tax.

Any prediction on their value then anyone?

Not anywhere near where they will reach on friday.
There are two values you can put on a share,the intrinsic value and the market value.
As the business rationalises and sells assets its intrinsic value will obviously decrease.

That only leaves its market value to attract buyers,can it keep posting healthy profits and paying out juicy dividends?
Not sure.....

[k979aaa]

Sadly the corrupt financial system continues to allow the big players to take massive profits out of Privatised public companies...

The private investor (joe public) will not receive the shares for about a week after the start of trading when the shares wuld have stabilised a bit from the initial high.

If this was limited (protectionism and illegal of course) to just pension funds or other useful fund managers then one can understand but the system allows foreign investors and hedge funds to cream 'off' some of the profits.

Anyhow, the value of the free shares is somewhat irrelevant at this stage. The real deal is that 5-7% of £2000 (average) is a tidy sum - and that is the guaranteed Dividends.

So now my shares will offset my loss of T/C pension working conditions and pay rise I am so lucky our dividend will save the day! Do we get one or does it all go into the SIP? do we get this cash in hand or pay tax on it as I could be a millionaire with rental property's far exceeding my income a strike would not benefit me would it? Tell you what I have given up on capitalism already!

[daveyeff]

are they not tied into the pay deal. therefore making them a dubious reward?