How much are shares worth..

[Andy_07]

Little bit of chat in the office as to how much our shares are worth SHOULD you wan't to cash in next October bearing in mind it's taxed.

I reckon after tax 2 grand in my pocket as opposed to 4/5 grand that's getting banded about from my work mates

[pants123]

Cannot cash in till oct 2016.. and its only the shares that were allocated first... maximum value 3 k when royal mail floated on the market for tax reasons...

No price can be put on the value till next oct 2016...

So they may be worth more or worth s h i t..

[RobertT]

The share price as of today is £4.64, so if you were able to sell the first batch that were handed out in October 2013, which for full timers is 613 shares, they would be worth £2,844.
Tax and NI totalling 32% would need to be taken off, so that would give you £1,933 minus dealing charges.

But as pants says, it is totally irrelevant at the moment.

[Spedley]

Taxed meaning you have to fill out a tax return - if you reinvest in something else you don't have to pay tax.

[RobertT]

Taxed meaning you have to fill out a tax return - if you reinvest in something else you don't have to pay tax.

If you cash in your shares after 3 years but before 5 you will pay tax and NI - they are the rules of the SIP!
Where you then put the money is irrelevant.

More info on when you need to fill in a tax return: https://www.gov.uk/self-assessment-tax- ... tax-return" onclick="window.open(this.href);return false;

[bustedflush]

Taxed meaning you have to fill out a tax return - if you reinvest in something else you don't have to pay tax.

If you cash in your shares after 3 years but before 5 you will pay tax and NI - they are the rules of the SIP!
Where you then put the money is irrelevant.

More info on when you need to fill in a tax return: https://www.gov.uk/self-assessment-tax- ... tax-return" onclick="window.open(this.href);return false;

Yes, you pay tax but only over £2000 I believe....

[RobertT]

Taken from page 28 of the ‘guide to RM shares’ we all received 2 years ago which can also be found here: https://www.myroyalmail.com/sites/defau ... ochure.pdf" onclick="window.open(this.href);return false;

Income tax and National Insurance are calculated using the market value of the shares at the time the employee was given the Free Shares or the market value of the Free Shares when the employee removes them from the SIP, whichever is lower.

The market value is currently lower than it was when we received the first batch of free shares – it was £4.89 on 15th October 2013! Therefore tax & NI will would currently be payable on the full value.
There is no £2,000 limit.

[wandle]

So if the share price is above £4.89 at the point we could sell, tax would be payable on the lower £4.89 price:

613 x 4.89 x 32% = £959.22

The question is, having waited 3 years already, is it really sensible to to toss away nearly a grand, by paying tax unnecessarily?

If you hold onto them for another 2 years, not only would you not be liable for tax, you would receive - on the batch of 613 shares in question - about £270 in dividends in those two years.

Somebody selling in 2016 at say 500p/share would receive £2105.78

Even if the share price collapsed and was only £3 in 2018 (unlikely), a seller of 613 shares would receive £1839. Allowing for the £270 of dividends received, they would still be better off than the fool who sells early and plays tax !!!

[Darren Bent]

so where do figure of 32% rate for tax/national insurance come from on shares. Just asking.

[RobertT]

so where do figure of 32% rate for tax/national insurance come from on shares. Just asking.

Assuming a basic rate taxpayer, which most posties will be: Income Tax = 20%, NI = 12%.
Details can be found in your 'guide to RM shares', or page 29 here: https://www.myroyalmail.com/sites/defau ... ochure.pdf" onclick="window.open(this.href);return false;

[Surreypostie]

so where do figure of 32% rate for tax/national insurance come from on shares. Just asking.

Assuming a basic rate taxpayer, which most posties will be: Income Tax = 20%, NI = 12%.
Details can be found in your 'guide to RM shares', or page 29 here: https://www.myroyalmail.com/sites/defau ... ochure.pdf" onclick="window.open(this.href);return false;

Robert, nobody, well nobody I speak to understands all that stuff, that is why we are postman, not accountants or tax dodgers. We would be stuffed without you.

[bustedflush]

so where do figure of 32% rate for tax/national insurance come from on shares. Just asking.

Assuming a basic rate taxpayer, which most posties will be: Income Tax = 20%, NI = 12%.
Details can be found in your 'guide to RM shares', or page 29 here: https://www.myroyalmail.com/sites/defau ... ochure.pdf" onclick="window.open(this.href);return false;

LOL....aren't you forgetting the poor sods taken on on 16,8 hour contracts etc. who'll pay no tax?
In this case, if their share allocation added to their earnings comes out at BELOW their basic tax-free allowance, would they pay tax at all on their share sale even if before 5 years? In other words are there any tax breaks which must be returned regardless of tax free-allowance threshold?

[RobertT]

so where do figure of 32% rate for tax/national insurance come from on shares. Just asking.

Assuming a basic rate taxpayer, which most posties will be: Income Tax = 20%, NI = 12%.
Details can be found in your 'guide to RM shares', or page 29 here: https://www.myroyalmail.com/sites/defau ... ochure.pdf" onclick="window.open(this.href);return false;

LOL....aren't you forgetting the poor sods taken on on 16,8 hour contracts etc. who'll pay no tax?

No, I was going by the majority of postal workers, who are basic rate taxpayers.

In this case, if their share allocation added to their earnings comes out at BELOW their basic tax-free allowance, would they pay tax at all on their share sale even if before 5 years? In other words are there any tax breaks which must be returned regardless of tax free-allowance threshold?

As far as I know and going by the literature provided by RM, those people who earn less than the personal tax allowance, including the value of the free shares at the time of sale(including after 3 years), will pay no income tax although they may still pay NIC’s. Although in practice they may well pay tax initially but should be entitled to a refund.

Equally, there may be some people who already are or will be for one tax year, a higher rate taxpayer due to selling their shares. In which case they will pay 40% tax on some of their income.

[Decky Boy]

My advice would be to hang onto your shares (as long as you are with the company) and collect the good dividend every year As an OPG of nearly 8 years , I know how hard we all work. I cannot envisage the shares dropping below £3.30 in the next few years. Why would they ? ? ?

PS: Andy... there's a big bastard box immediately below your post, on the homepage, which shows the current price of Royal Mail Shares.

[datasaint]

My advice would be to hang onto your shares (as long as you are with the company) and collect the good dividend every year As an OPG of nearly 8 years , I know how hard we all work. I cannot envisage the shares dropping below £3.30 in the next few years. Why would they ? ? ?

Well TNT were predicting 40% coverage of UK addresses for their letter delivery business by 2017 and look how that went down the pan.

I think there will have to be big changes in RM to keep the business profitable in the years to come, e.g. larger use of automation, scaling back the USO, merging delivery/collection into one working day.