Approved Profit-Sharing Schemes (APSS) If an employer operates an APSS, they may allocate Income Tax free shares to an employee provided certain conditions are met. The employer can allocate shares to an employee up to a maximum annual limit of €12,700. The shares allocated must be held in a trust set up by the employer. The shares must be held in the trust for a […]
Nature An employee or director may be granted the right to acquire shares at an option price during a fixed period. If share prices rise, in tandem with the company’s, earnings and profitability, the option holder may exercise the option and realize a gain on the shares. If the market value of the shares falls below the option price, the option has no value and […]
Share Options Schemes A share option is a right granted to an employee, director, or executive to subscribe for shares at some point in the future at a price specified or to be defined. The option must be exercised in accordance with the terms for the purchase of the shares to proceed. If the option is not exercised, it will expire. Generally, share options are […]
Unapproved Share Option Schemes The employer must file a return by 31st March in a format covering all unapproved option schemes. Within 30 days of the exercise of an unapproved share option, the employee must submit a return online, along with payment of the relevant tax. This tax is applied at 40% on the share option gain unless the taxpayer satisfies Revenue that a lower […]
Overview Most employee share schemes fall into three categories; profit-sharing schemes, savings-related schemes, and executives share option schemes. Tax breaks are central to employee share schemes. Most schemes are tailored around reliefs made available by tax legislation. The legislation is part of a state policy of encouraging employee participation in the economic success of the employer. Share option schemes are used most commonly by listed […]
Overview Employer-organised savings schemes may facilitate the purchase of shares under a share option scheme. An employee or director may be granted the right to purchase or acquire shares in the employer company under an approved savings-related share option scheme. The shares are paid for out of the proceeds of the certified contractual savings schemes. The tax legislation permits employees to save part of their […]
Overview Revenue may approve an Employee Share Ownership Trust, which is established for the benefit of all employees and full-time directors. The trustees must acquire shares in the establishing company for the benefit of and ultimate distribution to employee beneficiaries. The trust may be funded by contributions from the company that establishes the scheme and/or by borrowing. The ESOT trustees become shareholders. ESOTs facilitate the […]