FAQs

As a result of Revenue mandated changes to company share saving schemes in 2022, the Tesco Ireland SAYE Scheme is offered as a non tax-advantaged Scheme. All gains on share purchases through the SAYE Scheme will be subject to Income Tax in addition to the PRSI & USC. Income Tax, PRSI and USC can’t be deducted through payroll as the Revenue Commissioners require this to be settled on an individual basis.

Here’s an example of a colleague who saves €20 per month in the 3-year Scheme:

Savings Per Month €20 per month
Total Savings - 3 year €20 * 36 months = €720
Discounted Option Price £2.50
Exchange Rate €1 = £0.8504113 [example only]
Savings in £ €720 = £612.30
No of Shares £612.30 divided by £2.50 = 244 share options
Share Price after maturity £3.25
Value of Shares £ 244 share options * £3.25 = £793
Value of Shares € £793 = €932.48
Taxable Gain €932.48 - €720 = €212.49
Income Tax, USC & PRSI to be paid by colleague €212.49 * 52% = €110.49
Return for the Colleague €932.48 - €110.49 = €821.99
Total Gain after Income Tax, USC & PRSI for Colleague €821.99 - €720 = €101.99

All Tesco colleagues who have completed at least three months’ continuous service by 17 November 2023.

The Option Price for the current invitation can be found on the invitation page, on posters and on OurTesco.ie from 17 November 2023.

Your savings will be taken from your pay after tax every four weeks (or every week if you are weekly paid), starting in February 2024.

Deductions will stop from your pay in March 2027 and March 2029 for the three-year and five-year Schemes respectively, dependant on tax weeks and the payroll cycle.

No, once the invitation has closed you won’t be able to reduce or increase the amount. You will however be able to cancel the Scheme if you no longer wish to save into the Scheme and your savings will be returned to you. You can also take a savings holiday if you need to.

At the end of your savings contract you will have the following options:

Option 1) Take cash

You can take the cash you have saved. There are no income tax, Universal Social Charge (“USC”) or Pay Related Social Insurance (“PRSI”) implications should you choose to do this.

Option 2) Acquire shares

If you decide to exercise your share options and buy shares at the discounted Option Price, the exercise gain will be subject to Income Tax, USC and PRSI. The exercise gain is calculated as the difference between the actual share price on the date you buy your shares (this will usually be in 3 or 5 years’ time) and the discounted Option Price.

Income Tax must be paid at the higher rate of tax (40%), USC must be paid at the higher rate of 8% and Employee PRSI must be paid at the standard rate of 4%. When you submit your Income Tax Return, Revenue will assess if an overpayment and refund are due based on your total income within the tax year.

The Income Tax, USC and PRSI must be paid by you to the Revenue Commissioners within 30 days of you exercising your options (buying the shares at the discounted Option Price). You will also be required to report the Income tax, USC and PRSI on the exercise gain by submitting a Form RTSO1 to the Revenue Commissioners within 30 days. A link to the form and some further information can be found at Revenue Online.

You will be required to disclose details of the share purchase in an annual self-assessment income tax return. Further information is available on Revenue Online.

Tesco will be required to report to the Revenue Commissioners details of all colleagues that have exercised shares options through the SAYE Scheme.

Sell shares acquired

If you decide to buy shares at the discounted Option Price and sell them immediately, you should not be subject to capital gains tax on the basis the market value at which you sell the shares is equal to the market value when you purchased the shares.

Should you decide to sell the shares at a later date, you may be subject to capital gains tax if the gain/profit together with the gain/profit on all other disposals in any one tax year is more than €1,270.

The current capital gains tax rate is 33%. Should this apply, you will be responsible for reporting and paying the capital gains tax to the Irish Revenue Commissioners. You must report this disposal to Revenue, even if no tax is due. Your employer will not deduct any tax or report the disposal for you.

You will be responsible for reporting and payment of all taxes through the self-assessment system, this will also apply if you leave Tesco and are able to buy a reduced number of shares at the Option Price.

As the SAYE Scheme is not an Irish Revenue tax-advantaged SAYE Scheme, there is no tax-free bonus and no interest will be paid on the savings. This does not impact pre-2022 SAYE Schemes that are already in place.

The maximum number of shares is determined by your savings, the Option Price and the exchange rate at the time of the grant. If the Euro weakens you can use all the funds saved to buy shares. This will be less than the maximum number of shares over which your option was granted. If the Euro strengthens, you can acquire up to a maximum number of shares over which your option was granted. The excess savings will be refunded to you.

For more information please go to Colleague Help. Alternatively, you can call the Tesco Shares Helpline on +44 371-384-2876*.

*Please note that standard rates apply.

In making an application, you’re applying to join the SAYE Scheme which is run in accordance with the Scheme rules on which we intend to rely. Full terms and conditions, Bank Prospectus and the Financial Services Compensation Scheme Information Sheet and Exclusions list referred to have been made available in the Useful links section.

These form the basis on which Equiniti services will be provided to you. For your own benefit you should read these terms carefully before giving an application instruction. If you do not understand any point please call +44 371-384-2876**.

You understand that if this declaration is untrue in any respect any interest or bonus payable under the plan will be forfeited. By applying to join the Scheme you acknowledge that you have read the Financial Services Compensation Scheme Information Sheet and Exclusions list.

If you would like to receive a copy of this brochure in an alternative format, for example Braille or audio tape, please contact Equiniti on +44 371-384-2876**.

**Please note that standard rates apply.

* Because of the nature of the share price displayed on the site, Equiniti can't verify whether it's accurate or up-to-date. If Equiniti becomes aware that the end of day share price data isn't accurate or up-to-date then they'll remove it from the site or take other appropriate action. Equiniti isn't responsible or liable for either the accuracy or availability of the share price data on the site.

Shares Calculator

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Step 1.

You can save between €12-€500 every four weekly pay period.

If you save in other SAYE Schemes, the maximum you can save in total is €500 every four weekly pay period.

Step 2.

Step 3.


Once you've finished saving, at maturity

1. Your total savings - at the end of your savings period

2. Number of Option Price shares you could buy with your savings*

0

3. The potential value of these shares calculated at the Tesco share price you hope to see at maturity*

4. If you could choose to sell your shares immediately, you could make this amount of profit*

*based on the share price you have entered in step 3 above

At the end of your savings contract, if you use your savings to buy shares, the potential profit or Exercise Gain will be subject to Income Tax at 40% in addition to PRSI at 4% and USC at 8%. The Exercise Gain is calculated as the difference between the actual share price on the date you buy the shares in three or five years time and the Option Price. The Income Tax, PRSI & USC (known as Relevant taxes) which are due on the purchase of shares from the SAYE Scheme can’t be deducted through payroll as the Revenue Commissioners require each individual to settle their own taxes.

For the purpose of the calculator section we have used an example exchange rate of 1 Euro equals 1 pound sterling. The potential profit you may take at maturity will depend on the exchange rate at that time.