Share trusts

If you provide shares to your employee through a trust, and your employee has an interest in a specific number of shares in the trust (rather than specific shares), we treat your employee as holding a beneficial interest in each of that number of shares.

If this is the case, when fulfilling your reporting obligations, you must give an ESS statement to all your employees who have acquired shares through that trust and include this information on the statement you provide to us.

You will not be required to provide a statement to the trustee of the share trust. The trustee of the share trust will not be required to provide a statement to its beneficiaries.

Example: Employee share trust and reporting

Lee works for Gag Ltd. Gag Ltd has an ESS that provides Lee with shares through its employee share trust, Gag Share Trust. Gag Ltd is the provider and Gag Ltd, rather than Gag Share Trust, must report to their employees and us.

End of example

General deduction for employers

A general deduction may be available for you if you provide money or other property to an employee share trust to enable it to acquire securities to provide to your employees.

The deduction would generally be available to you in the income year that the money was paid to the share trust. However, the ESS rules defer the timing of the deduction until your employee acquires the ESS interest.

Last modified: 21 Dec 2015QC 47636