Where a clawback or share award is done pre-vesting there should not be any tax issues, but where it occurs post-vesting, how to recover the tax already paid becomes an issue. A number of income tax reliefs could apply, including the intriguing concept of ‘negative income’, but there is no provision to recover NICs. Capital losses might also be available. As HMRC has not yet expressed a view as to the applicability of these reliefs, the cautious approach must be for employers to assume only the net award can be clawed back.
