Goldman bonus delay may cost UK taxman millions

The UK taxman could miss out on millions of pounds in revenue from bankers if Goldman Sachs decides to go ahead with plans to delay paying part of their bonuses until the next tax year.

Sources familiar with the situation said Goldman may pay share bonuses awarded for 2010 and 2011 performance after April 6 so that staff can avoid paying the top 50% rate of tax which drops to 45% in the new tax year.

This would mean that a UK banker who earned a £1 million deferred shares bonus in 2010 and 2011 would avoid £50,000 of tax.

Goldman’s bonuses are typically paid 40% in cash during the year they are earned and 60% in shares which are deferred over the next three years.

The bank paid out around  $40 million (£24.8 million) of such deferred share awards to US employees just ahead of the “fiscal cliff” vote in the United States at the end of December to help them avoid higher income taxes.

Sources close to the bank said that 2012 bonuses, which will be announced to staff shortly after Goldman releases its full-year results on Wednesday, will be paid as usual so that the cash bonus will attract 50% tax in the UK.

Other London-based banks have looked at similar schemes allowing their staff to avoid some of the highest rate of tax.