Stock options only provide a tax advantage when exercised

In a stock option model, the granted options allow employees to purchase shares of the company (e.g., shares) at a pre-determined exercise price. This is usually useful when the current share price is higher than the exercise price and expenses associated with the exercise are also taken into account. The Supreme Administrative Court has decided to grant stock options to employees, tangible benefit and thus Income from non-self-employed activities Only when exercised this Options can occur and not already, for example, in the granting of the stock option (GZ 2006/13/0136 of 15.12.2009).

The VwGH therefore emphasizes the Inflow principle and also takes into account the fact that at the time of the Granting not a concrete advantage, but much more likely a tax-ineffective opportunity from the stock options, and therefore a quantification of the benefit would be difficult. The specific case also shows that the benefit that accrues upon exercise and is taxable is based on the grounds of employment relationship It must be paid – it is irrelevant whether the option is granted by the employer (directly) or by the parent company. The benefit from the exercise of the stock option, which is to be taxed as non-self-employed income, is calculated from the price of the security at the time of exercise minus the exercise price and any fees.

It should also be noted that the tax incentives in connection with Stock options have been abolished by the Tax Reform Act 2009 and only apply to stock options that before dem April 1, 2009 were admitted.

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