Tax Breaks - Share and Stock Options for Employees

Tax Breaks : Employee Share Option Schemes

New tax treatment was introduced in the Finance Bill 2001 for employee share options schemes.

Tax Treatment
From February 15th 2001, the new tax treatment will be as follows:

Capital gains tax of 20% will be payable on any gain between

The price at which the shares are granted to the employee.

The price at which the shares are sold.

This is the only tax that will apply.

This contrasts with the previous situation, where some employees could have suffered income tax at 42% on the sale of shares in the company they worked for.

Conditions

The scheme must be Revenue approved.

Schemes must be open to all employees on similar terms.

Alternatively, a scheme will qualify where it makes at least 70% of the total amount of share options available to all employees. In other words, it is possible to introduce a key employee element.

The employee must hold the shares for at least three years before selling.

There will be no limit on the amount of shares that can avail of the tax treatment.

The Role of Boylan & Dodd

How will we help you utilise this incentive scheme? We will:-

ensure your scheme is Revenue approved

Market the scheme to your employees.

Please EMail us by clicking here.

Tax Treatment
From February 15th 2001, the new tax treatment will be as follows: Capital gains tax of 20% will be payable on any gain between The price at which the shares are granted to the employee. The price at which the shares are sold. This is the only tax that will apply. This contrasts with the previous situation, where some employees could have suffered income tax at 42% on the sale of shares in the company they worked for.
Conditions
The scheme must be Revenue approved. Schemes must be open to all employees on similar terms. Alternatively, a scheme will qualify where it makes at least 70% of the total amount of share options available to all employees. In other words, it is possible to introduce a key employee element. The employee must hold the shares for at least three years before selling. There will be no limit on the amount of shares that can avail of the tax treatment.
The Role of Boylan & Dodd
How will we help you utilise this incentive scheme? We will:- ensure your scheme is Revenue approved Market the scheme to your employees. Please EMail us by clicking here.