Employee Share Scheme tax rules
A big step in the right direction for start-ups
16 January 2015: On Wednesday, the Government released its draft of the proposed amendments to the Employee Share Scheme (ESS) tax rules.
“In our ‘Barriers to Innovation’ submission, Deloitte called for a broader change to the tax on employee options as well as specific equity tax incentives for start-ups,” comments Rob Basker, Deloitte Australia global employer services partner. “We are pleased to see that the Government shared our view and that the amendments focus on both.
“In the Deloitte submission we noted a holistic view of the ESS changes, and not just a simplified solution, was needed to meet the needs of the start-up community. Deloitte’s submission called for many areas to be considered and addressed together if the Government was serious about helping the start-up space. The vast majority of our suggested changes have been included in the draft, or called for in the further consultation.
“While the draft of the new tax rules will need to be worked through to ensure the changes will be fully effective, Deloitte is pleased the start-up community’s concerns are being addressed.
“However, one question remains on the definition of a start-up, which may need to be re-thought. If there is an aggregate turn over threshold and an incorporated maximum period of 10 years, does it matter if a company is listed or not?”
Notes to Editors:
The table below outlines the recommendations outlined in Deloitte’s ‘Barriers to Innovation’ submission, and those announced by the Government earlier this week:
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