12 May 2016
Feedback sought on taxation of employee share schemes
An officials’ issues paper seeking feedback on the taxation of employee share schemes was today release for consultation, Revenue Minister Michael Woodhouse says.
Employee share schemes are arrangements that allow employers to provide shares and share options to their employees as part of their remuneration.
“Employee share schemes are becoming a much more popular form of remuneration, so it’s important the tax treatment of share schemes is fair,” Mr Woodhouse says.
“The proposals in the issues paper seek to modernise the rules, provide a clear basis for tax deductions and address the current under-taxation of certain complex share schemes.
“The current tax treatment can mean there is a lot of uncertainty about the rules and as a result, some people are under or over taxed. The issues paper aims to address that by ensuring tax rules don’t pose obstacles to the use of share schemes.”
The proposals released for public consultation have been developed to ensure that the taxation of employee share schemes is
- simple, efficient and fair;
- consistent with the taxation of salaries paid in case; and
- fits well into New Zealand’s broad-based, low-rate taxation approach
The consultation document, Taxation of employee share schemes is available at www.taxpolicy.ird.govt.nz and submissions close on 22 June.