Budget 2019: Stock Options Back In The Spotlight

Just when you think you are out, they pull you back in. In the 2016 election, the federal Liberal Party's platform included a review of the taxation of stock options and a cap of $100,000 on options that could receive preferential tax treatment. This was followed by a backlash from the business community, including cash-strapped start-up technology companies who utilize stock options to incentivize employees. Backtracking, the Liberal Government subsequently said it would not change the taxation of stock options. However, the Liberal Budget delivered on March 19, 2019 ("Budget 2019") announces a cap to the use of the current employee stock option tax regime, suggesting a move towards aligning with the U.S. tax system.