Who Needs to File a Shares Tax Return in Ireland?
You need to file an income tax return or in some cases, a separate RTSO1 form if any of the following apply to you:
You received shares or share options from your employer under any type of share scheme. You exercised share options during the tax year. Your Restricted Stock Units (RSUs) vested and you received shares or a cash equivalent. You sold shares whether employer-granted, privately held, or publicly traded and made a gain above the annual CGT exemption. You received dividend income from Irish or foreign company shares. You hold shares in a foreign company acquired through an employee share plan. You are a shareholder in an Irish company and received profit distributions. You sold shares in a private company as part of a business exit or restructuring.
Revenue receives data from employers, stockbrokers, and other sources. If you have unreported share income or gains, the risk of a Revenue query or audit is real. Filing correctly and on time is always the better approach.
Types of Employee Share Schemes in Ireland And How They Are Taxed
Employee share schemes are either Revenue-approved (sanctioned by Revenue and carrying specific tax benefits) or unapproved (employer-designed, with income tax applying in full). Here is how the most common ones work.
Share Options Unapproved Schemes
A share option gives you the right to buy company shares at a fixed price, usually below the market price at the time you exercise the option. When you exercise the option that is, when you buy the shares the difference between the market value of the shares and the price you paid is treated as employment income and is liable to income tax, PRSI, and USC.
Under an unapproved share option scheme, the tax due is not collected through PAYE by your employer. Instead, you are responsible for filing a Form RTSO1 and paying the Relevant Tax on Share Options (RTSO) directly to Revenue within 30 days of exercising the option. This is a tight and often missed deadline.
If you do not sell the shares immediately after exercising the option, you may also be liable to Capital Gains Tax (CGT) when you eventually sell them calculated on any gain made between the price at the date of exercise (which becomes your acquisition cost for CGT purposes) and the sale price.
Restricted Stock Units (RSUs)
RSUs are one of the most common forms of equity compensation in Ireland, particularly in multinational technology, pharmaceutical, and financial services companies. An RSU is a promise by your employer to give you shares or their cash equivalent after a defined vesting period, typically one to four years.
When RSUs vest, the value of the shares on the vesting date is treated as employment income. Your employer should process income tax, PRSI, and USC through PAYE on that date. Many employers operating internationally handle this correctly, but discrepancies are common particularly where shares are granted by a foreign parent company and the tax treatment differs between countries.
If you hold the shares after vesting and subsequently sell them, any gain made from the vesting date value to the sale price is subject to CGT at 33%. This CGT event is your responsibility to declare your employer does not do it for you.
Save As You Earn (SAYE) Schemes
SAYE is a Revenue-approved savings-related share option scheme. You save a fixed amount of your salary each month for a set period typically three to five years and at the end of the savings period you have the option to use those savings to buy company shares at a discounted price (up to 25% below market value at the start of the scheme).
Because SAYE is an approved scheme, you do not pay income tax on the gain from the discount when you exercise the option. However, you do pay PRSI and USC on the discounted amount. And if you sell the shares after receiving them, CGT applies to any gain made between the exercise price and the sale price.
Approved Profit-Sharing Schemes (APSS)
Under an APSS, your employer can award you shares worth up to €12,700 per year completely free of income tax, provided the shares are held in trust for a minimum retention period (typically three years). This is one of the most tax-efficient employee benefits available in Ireland.
Even though the income tax exemption applies, you still pay PRSI and USC on the value of the shares. And when you eventually sell the shares, CGT applies to any gain made from the date the shares were transferred to you (at market value) to the date of sale.
Key Employee Engagement Programme (KEEP)
KEEP is a Revenue-approved share option scheme designed specifically for employees of qualifying SMEs. Under KEEP, employees are granted share options and unlike unapproved schemes no income tax, PRSI, or USC is payable when the option is exercised. Tax is deferred until the shares are eventually sold, at which point CGT at 33% applies (with entrepreneur relief potentially reducing this to 10% on qualifying gains up to €1 million).
KEEP is a powerful incentive for SME employees and employers alike, but the qualifying conditions are specific and the scheme must be properly structured to work as intended.
Dividend Withholding Tax (DWT) and Dividend Income
When an Irish-resident company pays a dividend, it deducts Dividend Withholding Tax (DWT) at 25% before distributing the remainder to shareholders. Even though DWT has been deducted at source, dividend income must still be declared on your income tax return, and you may have a further liability depending on your total income and marginal tax rate.
For dividends from foreign companies, DWT may not have been applied at source or may have been applied at the rate of the foreign country. Foreign dividend income must be declared in your Irish income tax return, and credit is available for foreign taxes paid under Ireland’s double taxation agreements.
Capital Gains Tax on Selling Shares in Ireland
Whenever you sell shares and make a profit whether they were employer-granted shares, shares you bought on a stock market, or shares in a private company Capital Gains Tax potentially applies.
The CGT rate in Ireland is 33% on the net chargeable gain.
The gain is calculated as the sale proceeds minus the allowable acquisition cost (what you originally paid, or the value at which the shares were taxed as income when received), minus incidental costs of sale (stockbroker fees, for example).
The annual CGT exemption is €1,270 per person per year. The first €1,270 of net gains in a tax year is exempt from CGT. This exemption cannot be carried forward if unused, it is lost.
CGT losses from other disposals in the same year can be offset against your gains. Unused losses from previous years can also be carried forward indefinitely and set against future CGT gains.
CGT filing and payment deadlines:
Gains made between 1 January and 30 November in a tax year: CGT payment is due by 15 December of that year. Gains made in December: CGT payment is due by 31 January of the following year. The CGT return is filed as part of your Form 11 annual income tax return due 31 October (or mid-November via ROS).
Missing these deadlines results in Revenue interest at 8% per annum on the unpaid CGT from the due date.
What We Do For You
RTSO1 filing for share options. If you exercised unapproved share options, you must file a Form RTSO1 and pay the RTSO within 30 days of exercising the option. We handle this within the required timeframe so you never miss Revenue’s 30-day window.
Form 11 income tax return. We include all share-related income RSU vesting, dividend income, SAYE proceeds, APSS shares correctly within your annual Form 11 return, with all applicable credits and deductions applied.
CGT calculation and return. We calculate your Capital Gains Tax accurately on share disposals factoring in your acquisition cost basis, indexation (where applicable for assets acquired before 2003), allowable costs, losses, and the annual exemption and file on time.
Employer scheme review. We review the type of share scheme your employer operates, confirm what tax your employer should have processed through PAYE, and identify any discrepancies or gaps that need to be addressed in your personal return.
Foreign share income and DWT. If you receive dividends or share grants from a foreign parent company, we handle the cross-border tax treatment correctly applying double tax relief where available and ensuring Revenue’s disclosure requirements are met.
KEEP scheme structuring. For SME owners and employees considering KEEP, we advise on qualification, scheme design, and the interaction with entrepreneur relief on a future disposal.
Revenue query management. If Revenue contacts you about share income a query letter, an aspect query, or a full audit notification we manage the response professionally and represent you throughout.
Key Documents You Need
To prepare your company shares tax return accurately, we typically need:
Details of all share schemes you participate in (the scheme rules or employer summary documents), statements showing RSU vesting dates and the market value of shares on vesting, records of share option exercise dates and the exercise price paid, records of all share sales sale date, sale price per share, and number of shares sold, your original acquisition records showing the price paid and the date acquired, dividend income statements showing gross dividends received and any DWT deducted, and your previous tax return or assessment where share income was previously reported.
If your employer’s HR or equity administration platform (Fidelity, Computershare, Morgan Stanley, E*TRADE, etc.) provides annual statements, these are excellent starting documents. We will review them and confirm what additional information Revenue needs.
GET IN TOUCH
Bringing It All Together
Why Choose TAS Consulting for Your Shares Tax Return?
We know share scheme tax in Ireland in detail: The interaction between income tax, PRSI, USC, RTSO, DWT, and CGT across different types of share schemes is one of the more complex areas of Irish personal tax. We handle it every day for employees across all sectors.
We protect you from missed deadlines: The 30-day RTSO1 deadline for share options, the 15 December CGT payment deadline, and the October Form 11 deadline all need to be tracked separately. We manage all of these for you.
We identify every relief you are entitled to: Losses from previous years, the annual CGT exemption, foreign tax credits, and employer-side processing credits are all reviewed and applied. You should not pay a euro more in tax than the law requires.
We represent you with Revenue: If a Revenue query arrives relating to your share income, we manage it preparing the response, providing the documentation, and protecting your position.
Frequently Asked Questions
Do I have to pay tax on shares from my employer in Ireland?
Yes. Shares received from an employer in Ireland are employment income. Depending on the scheme type, income tax, PRSI, and USC may be payable when shares are granted or vest, when options are exercised, or when shares are sold. You must declare share income in your annual income tax return, regardless of whether your employer has processed any tax.
How much CGT do I pay on selling shares in Ireland?
Capital Gains Tax in Ireland is charged at 33% on the net chargeable gain the sale proceeds minus your acquisition cost and allowable costs of sale. The first €1,270 of net gains per year is exempt. Losses from other disposals in the same year can be offset against the gain.
What is RTSO and when must I pay it?
RTSO (Relevant Tax on Share Options) is the tax due when you exercise an unapproved share option in Ireland. It is payable within 30 days of exercising the option, along with a Form RTSO1 filed directly with Revenue. This obligation rests with you not your employer. Missing this deadline results in interest and potential penalties.
When do I pay CGT on RSUs in Ireland?
RSUs create two separate tax events. When RSUs vest, your employer processes income tax, PRSI, and USC through PAYE on the value of the shares at vesting. If you subsequently sell the shares, CGT applies to any gain made between the vesting-date value and the sale price. This CGT liability is your responsibility to declare payment is due by 15 December for sales between January and November, or by 31 January for December sales.
What is the KEEP scheme in Ireland?
KEEP (Key Employee Engagement Programme) is a Revenue-approved share option scheme for qualifying SMEs. Unlike unapproved schemes, no income tax, PRSI, or USC applies when options are exercised under KEEP. Tax is deferred until the shares are sold, at which point CGT applies with entrepreneur relief potentially reducing the rate to 10% on gains up to €1 million.
