Employee Share Purchase Plan transaction type

Nick_7403274

In the help menu it says to use the ESPP purchase and sell transaction types for employee share purchase plans however it doesn't seem to exist in my trial version, does anyone know if it is still an applicable transaction type?

Richard Winterscheidt

From the Help Menu (admittedly from full version of RPP15 and not trial)

Add an account to track employee stock purchase plan (ESPP) shares

Many companies offer an employee incentive known as an Employee Stock Purchase Program (ESPP), which offers employees shares of the company's stock at a discount. If you participate in an ESPP, you can then sell the stock at market value. For tax purposes, a portion of the difference between the discounted price of the stock and its market value when you sell is considered to be a part of your salary, and a portion is considered to be capital gain, but the amounts of each depend on how long you hold the stock before selling. Consult your tax advisor and the information included on your subsequent slip form to determine which part is gain and which part is salary or ordinary income.

Before purchase

1. Add a separate investment account to track your ESPP stock shares.
2. Set up your paycheque as a register transaction. In the paycheque setup window, under After Tax Deductions, click Add After-Tax Deduction, and then choose Stock Purchase (ESPP).
3. In the future, when you enter each paycheque into the register, Reckon Accounts will transfer the amount of your ESPP contribution to your ESPP investment account.

At the time of purchase

Use the Enter Transactions dialogues to help you record the purchase of ESPP shares.

There are two critical steps;

1. the separate investment account as most ESPPs deduct with each paycheque, and purchase (eg quarterly)

2. Enter transaction dialogues to record the purchase when it happens, that way you also have a record of residual balance, and you can transfer to your normal investment account when they become qualified (that is there are no other tax implications other than CGT)

Hope this helps 

Nick_7403274

Thanks, that's what I read as we'll. In the trial version under the transaction list you can choose from grant, sell and excersise employee stock options but not the ESPP buy/sell. Don't want to buy the license only to find out it isn't in there

Hoang

Hi Nick & Richard,

The workaround for this is by going into your security Portfolio, right click on the share then select Edit and you should be able to change the type to ESPP.


Thank you for your feedback, I have also pass this on to our developers to get it updated in the future releases.

Regards,
Hoang