By taxconnect on
Wednesday, July 06, 2011
Employee share schemes
Some companies encourage employees to participate in employee share schemes by offering employees shares, stapled securities or rights (including options) to acquire them (ESS interests) at a discount. Employee share scheme (ESS) income tax rules apply to this discount.
Shares and rights acquired before 1 July 2009
The ESS tax rules contained in Division 13A of Part III of the Income Tax Assessment Act 1936 that applied to shares and rights acquired before 1 July 2009 have been repealed. However these rules will continue to apply to any shares or rights acquired before 1 July 2009 on which tax has already been paid or was due to be paid.
ESS interests acquired after 30 June 2009
For ESS interests acquired after 30 June 2009, the ESS tax rules contained in Division 83A of the Income Tax Assessment Act 1997 apply.