After a lengthy consultation period considering proposed changes
to the Employee Share and Option Scheme (ESOP)
rules, the Federal Government appears set to announce, as part of
its "Competiveness Agenda", changes to the ESOP rules as
they apply to "start up" companies.
In this Alert, Special Counsel Justin Byrne discusses the
anticipated changes.
Key points:
- Currently, it is often the case that an employee will be taxed
in the year in which he or she receives an employee share scheme
share or option. Important changes were made to the ESOP rules in
2009 which affected the ability for the tax to be deferred until a
later point in time. The Federal Government has recognised that the
changes (introduced by the previous Government) were discouraging
business expansion, particularly for "start up"
companies.
