26 May 2023
2023 Australian Employee Share Scheme (ESS) Reporting
What is ESS reporting?
- ESS reporting is an annual reporting obligation for companies who provide their employees with shares, rights and/or options that are subject to tax under the ESS tax rules.
- ESS reporting will be applicable for any employee that has performed services in Australia during the relevant employment period of their equity awards (typically the vesting period) and a taxing event has occurred during the tax year (1 July to 30 June).
- Under ESS reporting, companies are required to provide a statement (ESS statement) to employees by 14 July following the end of the tax year. The ESS statement includes an estimate of the taxable value of ESS awards that reached a taxing point during the tax year. Companies are then required to lodge an annual report (ESS annual report) with the ATO by 14 August that details all the taxing events that occurred during the tax year for all their employees.
How can Vialto help?
- Prepare ESS statements for your employees – Our ESS statements include a detailed breakdown of all the transactions that are reported on the ESS statement and a tailored company covering letter to detail any positions or company specific information. This makes it easy for employees (and their accountant) to understand and reconcile the amounts reported on the ESS statement. This significantly helps to reduce the queries that companies receive from employees regarding their ESS statements.
- Prepare and lodge the employer ESS annual report – we have developed software in accordance with the ATO’s specification to allow for fast and efficient lodgment of the employer ESS annual report.
- Determine ESS income for State payroll tax purposes – As ESS income is typically not paid through payroll in Australia, it needs to be manually added to the relevant state payroll tax return/annual reconciliation. Correctly reporting ESS income for payroll tax purposes is a commonly overlooked item by many companies and can attract significant penalties.
For assistance with ESS reporting, please reach out to:
Marc Bosotti
APAC
marc.bosotti@vialto.com
AmyLynn Flood
Americas
amy.lynn.flood@vialto.com
Gemma Ludwig
EMEA
gemma.ludwig@vialto.com
Further information on Vialto Partners can be found on our website: www.vialtopartners.com
Vialto Partners (“Vialto”) refers to wholly owned subsidiaries of CD&R Galaxy UK OpCo Limited as well as the other members of the Vialto Partners global network. The information contained in this document is for general guidance on matters of interest only. Vialto is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information is provided “as is”, with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. In no event will Vialto, its related entities, or the agents or employees thereof be liable to you or anyone else for any decision made or action taken in reliance on the information in this document or for any consequential, special or similar damages, even if advised of the possibility of such damages.
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