New Equity Compensation Legislation in Australia
Executive Director
On June 25, the Australian Senate passed the Tax and Superannuation Laws Amendment (Employee Share Schemes) Bill 2015, designed to encourage equity compensation plans. The amendments would reverse a 2009 bill that caused a dramatic reduction in the use of equity compensation plans in Australia. The changes in the current bill, effective as of today, July 1, will improve the tax treatment of options and discounted shares, including having options taxable at exercise rather than vesting and providing certain qualifying employees in startup companies with capital gains treatment. Employee Ownership Australia and New Zealand estimates that the change would add AUS 1.4 billion ($1.1 billion USD) to the Australian economy over the following 10 years.