Salary Foregone/Salary Sacrifice

Salary Foregone, also known as Salary Sacrifice, is a Revenue approved employee share plan linked to the Profit Sharing scheme which allows you to forego an element of pay to purchase additional Diageo shares.

Full income tax relief is allowed on the amount of pay foregone.

Salary Foregone

If you are eligible to receive an invitation to Salary Foregone a pack was posted to your home address on Monday 26 November 2018. The invitation pack contains the following documents:

  • Covering letter and factsheet 
  • Salary Foregone application form
  • Pre-Paid Envelope

If you have not previously completed a Contract of Participation you will have also received:  

If you have not received your application pack by Thursday 6 December 2018 please contact us.

If you would like to join Salary Foregone 2019 please ensure your application form and contract of participation (if applicable) are returned to the shares team by Thursday 3 January 2019. 

Baileys Salary Sacrifice

Invitations to Baileys Salary Sacrifice eligible participants were posted 22 November 2018. If you have not received your application pack by Wednesday 5 December 2018 please contact us.

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Salary Foregone also known as Salary Sacrifice is a Revenue approved employee share plan linked to the Profit Share scheme which allows you to forego an element of pay to purchase additional Diageo shares. Full income tax relief is allowed on the amount of pay foregone. However, following the Budget 2011, any shares awarded under an Approved Profit Sharing Scheme (including shares awarded as part of a Salary Foregone/Salary Sacrifice arrangement) will be liable to Pay Related Social Insurance (PRSI) and Universal Social Charge (USC).

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You will receive an invitation to join the scheme in December each year. You have a choice to forego a weekly/monthly amount from gross pay free of income tax only.

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You will be advised by invitation of the maximum amount of salary you can forego. There are certain limits.

  • The amount contributed must not exceed the value of shares acquired under the profit sharing scheme in any tax year.

  • The amount you contribute must not exceed 7.5% of eligible pay (the actual percentage will however not exceed the Profit Share percentage in the same year)

  • The total amount, together with the value of shares acquired under the Profit Sharing Scheme must not exceed the overall limit of €12,700 in any tax year.

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Only employees who receive Profit Share/Share Participation and who have completed the agreed savings are eligible to receive Salary Foregone/Salary Sacrifice shares.

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The number of shares you get is based on your savings. The total amount you contribute must not exceed the value of your shares received under the Profit Sharing scheme.

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Employees savings under the Diageo Salary Foregone/Salary Sacrifice are normally allocated shares in September. You will receive a communication confirming your allocation soon after.

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You may not have received Salary Foregone/Salary Sacrifice shares for one of the following reasons

  • You are employed by an employment agency, not by a Diageo Ireland Company.

  • You are employed by a part of Diageo Ireland that does not participate in the Salary Foregone/Salary Sacrifice scheme.

  • You stopped saving during the year.

  • You did not complete an application to participate.

  • You did not complete a Profit Share/Share Participation application form.

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Salary Foregone/Salary Sacrifice shares are held in Trust on your behalf for 3 years. You will receive a share certificate at the end of the 3 year period.

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The release date is the date the shares are transferred out of Trust (i.e. on the third anniversary of the allocation date) and registered on the main Diageo Register of Shareholders. On this date a share certificate is automatically issued in your name and you are free to sell the shares without any income tax liability.

If you retain your share certicate you MUST keep this in a safe place.

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Your personalised shareplan summary statement is available to view online by logging on to www.mydiageosharesplus.com

For detailed instructions on how to logon to your online statement please click here.

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  • You cannot dispose of your Salary Foregone/Salary Sacrifice shares within 2 years of receiving them.

  • If you chose to sell or transfer your shares after 2 years but before 3 years you will have a liability to Income Tax. You may also have a USC and PRSI liability.

  • If you hold your shares for 3 years or more there is no Income Tax liability when you sell them.

  • You may have a Capital Gains Tax liability and other tax liabilites.

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You must keep your Salary Foregone/Salary Sacrifice shares for a minimum of 2 years. You cannot sell or transfer your shares before this.

If you are leaving the company, you may be able to sell your shares earlier depending on your leaving reason.

For more information on what happens to your shares please select the relevant link below:

Redundancy
Statutory Retirement
Sale of Business

Resignation
End of Fixed Term Contract
Dismissal
Early Retirement

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Yes, Salary Foregone/Salary Sacrifice shares are ordinary shares in Diageo plc. You will receive dividends on any Salary Foregone/Salary Sacrifice shares that you hold on the dividend record date. Dividends are normally paid twice a year, in April and October.

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You can only transfer your shares if you have held them for 2 years. If you transfer shares between 2 and 3 years you will have a liability to Income Tax. You may also have a USC and PRSI Liability. After 3 years you can transfer your shares and there is no Income Tax liability.

Please note that you cannot transfer your shares to anyone who is under 18 years old.

If you are leaving the company, you may be able to transfer your shares earlier, please refer to the leavers notes below:

Redundancy
Statutory Retirement
Sale of Business

Resignation
End of Fixed Term Contract
Dismissal
Early Retirement

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Any Salary Foregone/Salary Sacrifice shares that you have are yours to keep. For shares still in Trust they will automatically transfer to you on the Release Date (the third anniversary of the allocation date).

For more information on what happens to your shares please select the relevant link below:

Redundancy
Statutory Retirement
Sale of Business

Resignation
End of Fixed Term Contract
Dismissal
Early Retirement

A.

You will receive a refund of any salary deducted up to your leave date. The refund will be free from PRSI and USC (as this was taken into account during deduction) but will be subjected to Income tax.

A confirmation letter will be sent to your home address. Please be sure to keep us informed if you change your address.

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You will receive a share certificate when your Salary Foregone/Salary Sacrifice shares are 3 years old. You must sell your shares through a Stockbroker or Bank. The Diageo Shares Office have negotiated a preferential rate of commission with Goodbody Stockbrokers. Forms and details on selling shares can be obtained by clicking here.