Australia – Employment-Related Equity, Stock Annual Lodgements Due by 14 July

Australia – Employment-Related Equity, Stock Annual Lod

This report covers the upcoming 14 July deadline for Australian Employee Share Scheme (ESS) reporting for the tax year ending 30 June 2019.

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The Employee Share Scheme (ESS) reporting for the Australian tax year ending 30 June 2019, is due on or before 14 July 2019.  Employers have an annual obligation to report any Australian taxable events that occur in relation to ESS.1

WHY THIS MATTERS

This is an employer reporting obligation that companies must comply with.  They should have appropriate systems and procedures in place to meet their ESS-related compliance obligations.

Penalties may be imposed on an employer if the submissions are not made on time.  Any delays or errors in reporting also have a negative impact on employee engagement as the information forms a critical part of their own tax return obligations.

KPMG NOTE: What Makes This Difficult

Identifying the Australian taxable event can be challenging:

  • Multiple legislative changes over recent years mean that different awards can be taxed under any one of three different tax regimes that operate concurrently, and that any single employee may hold a combination of awards, that collectively, are taxed under all three regimes;
  • There are taxing events that are unique to Australia, e.g., termination of employment, or if shares are sold within 30 days of the original deferred taxing point;
  • The first reporting obligations fall just 2 weeks after the close of the Australian tax year ended 30 June 2019; and
  • International assignments impact reporting obligations.

Concerned employers should consult with their professional tax service providers regarding appropriate ESS reporting technology or assistance.

More Details

Any Australian taxable events during the year up to 30 June 2018, must be reported to:

  • employees by 14 July 2019; and
  • the Australian Tax Office (ATO) by 14 August 2019.

Reporting to the ATO must meet specified electronic standard business reporting requirements, requiring a commercial software solution.

The obligation to report rests with the provider of the ESS.

If employees of Australian subsidiaries participate in a foreign parent ESS, the Australian subsidiary typically takes responsibility for the reporting obligations.

FOOTNOTE

1  For related information, see Employer reporting requirements on the ATO website.

The information contained in this newsletter was submitted by the KPMG International member firm in Australia.

KPMG Australia acknowledges the Traditional Custodians of the land on which we operate, live and gather as employees, and recognise their continuing connection to land, water and community. We pay respect to Elders past, present and emerging.

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GMS Flash Alert is a Global Mobility Services publication of the KPMG LLP Washington National Tax practice. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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