• Reporting to your employee

    ESS statement

    You must give your employee an ESS statement if:

    • they (or their associates) have acquired ESS interests under a taxed-upfront ESS at a discount during the financial year
    • a deferred taxing point for ESS interests acquired under a tax-deferred ESS (or a cessation time for shares and rights acquired before 1 July 2009) happened or could have happened in the financial year
    • a start-up concession acquisition event occurred, you must provide your employee with the following information about ESS interests acquired during the income year  
      • number of ESS interests acquired
      • market value of ESS interests acquired
      • acquisition price of ESS interests that are shares
      • exercise price of ESS interests that are rights
      • acquisition date of the ESS interests.
       

    You must provide the ESS statement to your employee by 14 July after the end of the financial year. The statement will help your employee complete their tax return.

    The information you must provide on the ESS statement includes, but is not limited to, the following:

    • the discount for ESS interests acquired under each type of taxed-upfront scheme
    • the discount for ESS interests acquired under a tax-deferred scheme if a taxing point happened during the financial year
    • the discount for shares and rights acquired before 1 July 2009 if a cessation time occurred during the financial year
    • the total TFN amount withheld from discounts during the financial year.

    When determining and reporting the discount at the deferred taxing point to your employee, you must take account of the 30-day rule if you know the ESS interests were disposed of by the employee.

    See also:

    Start-up concession (2016 and later income years)

    If your employee is eligible for the start-up concession, you must provide your employee with the following information about ESS interests acquired during the income year:

    • number of ESS interests acquired
    • market value of ESS interests acquired
    • acquisition price of ESS interests that are shares
    • exercise price of ESS interests that are rights
    • acquisition date of the ESS interests.

    Your employee will need this information to determine the cost base of their capital gains tax (CGT) asset and calculate any gain or loss when they dispose of their interests. They will not need to include a discount amount in their income tax return when they acquire the ESS interests.

    ESS interests provided to an associate

    The ESS rules treat ESS interests provided to an associate of your employee as if they were acquired by your employee, rather than their associate.

    Depending on the type of scheme and individual circumstances, your employee will have to pay tax, either upfront or at the deferred taxing point. Once tax has been paid under the ESS rules and the interests move into the CGT system, any future capital gain or capital loss incurred on these interests is borne by the associate.

    You must provide a statement to your employee, rather than to their associate, to fulfil your reporting requirements.

    Reporting amendments to your employee

    If you become aware of any material change to or omission from any information given to your employee on their ESS statement, you must use the Employee share scheme statement -amended employee summary form to provide them with the corrected information within 30 days of becoming aware of the change or omission.

    If you provide an employee with a right to an employment benefit that could later become an ESS interest, see Indeterminate rights.

    Next step

      Last modified: 12 Jul 2016QC 23058