I've been offered sweat equity in a US startup.
The company is in early pre-funding stage, no revenue, no value.
I will be granted around 4% common stock which will be vested on schedule based on services provided as a private contractor over 3 years.
I've looked everywhere can I can't find anything that clears up whether I can treat my equity as having nominal value at the time of granting (not vesting) thus avoiding/reducing income tax and NIC liabilities.
I appreciate that this is a long shot and likely to result in nothing, but if it does work out I don't want to be hit with tax bills that I can't pay without selling the equity.
Happy to pay the capital gains of course!
I've seen reference to a "Section 431 election" which allows declaring the value of the shares at the time of granting but I'm not sure if it might apply to US companies and nor do I know how to assign a valuation that HMRC wouldn't quibble over.
Any advice on how this should work?
Thanks in advance for any insight.
c.
The company is in early pre-funding stage, no revenue, no value.
I will be granted around 4% common stock which will be vested on schedule based on services provided as a private contractor over 3 years.
I've looked everywhere can I can't find anything that clears up whether I can treat my equity as having nominal value at the time of granting (not vesting) thus avoiding/reducing income tax and NIC liabilities.
I appreciate that this is a long shot and likely to result in nothing, but if it does work out I don't want to be hit with tax bills that I can't pay without selling the equity.
Happy to pay the capital gains of course!
I've seen reference to a "Section 431 election" which allows declaring the value of the shares at the time of granting but I'm not sure if it might apply to US companies and nor do I know how to assign a valuation that HMRC wouldn't quibble over.
Any advice on how this should work?
Thanks in advance for any insight.
c.
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