From 1 July 2015 there are new rules for the tax treatment of employee share schemes, including tax concessions for start-up companies.
Employee share scheme changes allow employees to now own up to 10 per cent of shares in their employer company, up from 5 per cent.
If employees choose to participate in a tax deferred scheme, the deferring point has also increased from 7 to 15 years.
Under the new rules, if shares are acquired in a start-up company at a discount of up to 15 per cent (relative to market value), then the discount is exempt from capital gains tax and income tax. Any capital gains tax is calculated on the market value when the share was acquired. It is not calculated on the discount price they paid, as long as that discount was 15% or less than the market value.
To offer an employee share scheme with start-up concessions, employers must:
be an Australian resident company
have an aggregated turnover of under $50 million
be incorporated for less than ten years
have no equity interests listed on an approved stock exchange.
Reference ATO website