Relevant Tax on a Share Option

A. In the majority of cases once you have exercised a share option you will have to file a tax return and pay over income tax on any gains that you have made.

The income tax due on the exercise of a share option is known as RTSO (Relevant Tax on a Share Option).

RTSO must be paid to the Collector-General not later than 30 days after the date on which the share option is exercised.

RTSO is payable on the difference between:

(a) the market value of the share(s) at the date of exercise of the share options; and

(b) the option price.

A Form RTSO1 is used for the purpose of making an RTSO payment to the Revenue.

Date published 13 Apr 2018

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.