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To: Zeev Hed who wrote (38407)	3/19/2000 3:41:00 PM
From: John Walliker	Read Replies (1) \| Respond to of 93625

Zeev, I am not sure how the UK tax law works... It is VERY complicated. However, for capital gains there is a tax-free allowance of about $10000. After that gains (made anywhere in the world) are taxed at the rate prevailing after all other income has been taken into consideration. This is at a maximum of 40%. Capital gains tax is payable at the end of January in year n for the previous year of April 6 (n-2) to April 5 (n-1). Exercising options is not a taxable event. There is a taper relief which progressively reduces the tax liability after the second year of holding the asset. For exercised options the date of holding is when the option was purchased for the option purchase price component and the exercise date for the strike price component. There are special accounts where tax is not payable within them, but only a limited amount of money may be invested in them per year. Small companies pay corporation tax on capital gains of around 20%, and investment trusts, unit trusts (mutual funds) and pension accounts do not pay capital gains tax internally. John