• Tax-deferred schemes

    ESS interests can be acquired under a taxed-upfront scheme, a tax-deferred scheme or, from 1 July 2015, a scheme that provides employees with the start-up concession.

    Under a tax-deferred scheme, the discount the employee receives on the ESS interests is included in the employee's assessable income when the ESS deferred taxing point occurs.

    In a tax-deferred scheme, the scheme and employee must satisfy certain conditions including:

    • for rights
      • there must be a real risk of forfeiture, or
      • (for rights acquired after 30 June 2015 only) there must be restrictions preventing immediate disposal and the scheme's rules must specifically state that it is a tax-deferred scheme.
    • for shares and stapled securities
      • there must be a real risk of forfeiture, or
      • the shares and stapled securities must be acquired under certain salary-sacrifice arrangements.

    For information on real risk of forfeiture of ESS interests, see Real risk of forfeiture.

      Last modified: 01 Jul 2015QC 27241