Employee share schemes - guide for employees

Introduction

The tax rules for employee share schemes (ESS) have recently changed and the new rules apply from 1 July 2009.

This is a general guide to explain how the new law applies to employee share scheme interests (ESS interests) you acquire under an employee share scheme (ESS).

The tax law contains specific rules for the taxation of ESS interests. The rules apply to shares, stapled securities and rights (including options) to acquire shares and stapled securities. Where you acquired ESS interests at a discount under an employee share scheme, the discount is taxed under these rules.

Where you did not acquire ESS interests at a discount, the employee share scheme tax rules do not apply. However, the benefits given in relation to these ESS interests may be taxed under other provisions of the tax law such as the capital gains tax regime.

For more information on capital gains tax, refer to the Guide to capital gains tax.