B Law & Tax
03 July 2023

Tax advisor: Taxation on the delivery of shares or stock in emerging companies

As from January 1st, 2023, the regulation of the taxation of the income from work in kind arising from the delivery of shares or participations of emerging companies is established. As from this date, the main new features are as follows:

– Exemption: the delivery of shares or participations to active employees of an emerging company, free of charge or at a price below market value, is exempt from taxation up to a limit of 50,000 euros per year per employee. This exemption applies provided that the offer is part of the company’s general remuneration policy and promotes employee participation in the company. In the event that the delivery of shares or participations arises from the exercise of purchase options previously granted to the employees by the emerging company, the requirements for the company to be considered as emerging must be met at the time the option is granted.

– Valuation: the delivery of shares or participations granted to employees of an emerging company is based on the value of the shares or participations subscribed by an independent third party in the last capital increase carried out in the year prior to the delivery, or in the event that no such increase has occurred, on the market value of the shares or participations at the time of delivery to the employee.

– As regards the delivery of shares or participations of an emerging company to employees, if these do not qualify for exemption due to exceeding the established limit, a special rule of temporary imputation is established for such income from work in kind. Under this rule, such income is imputed in the tax period in which one of the following circumstances is met: the capital of the company is admitted to trading on a stock exchange or any multilateral trading system, either in Spain or abroad; or the employee ceases to hold the corresponding share or participation in its assets. However, if ten years have elapsed since the delivery of the shares or holdings without any of the aforementioned circumstances having occurred, the imputation of the earned income associated with those shares or holdings will be made in the tax period in which the ten-year period is completed.

B Law & Tax International Tax & Legal Advisors.

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