The EU Prospectus Directive has been implemented into Austrian law. In general, a prospectus will be required for an offering of transferable securities unless an exemption or exclusion applies. As long as no consideration is paid by the employee for the restricted stock or RSUs, the award should be exempt from prospectus requirements (eg, 150-person exemption; possible other exemptions). However, non-transferable free offers of restricted stock or RSUs are not considered "transferable securities" subject to the EU Prospectus Directive.

Last modified 7 Jun 2024

Reporting to the Austrian National Bank is required under certain circumstances.

Last modified 7 Jun 2024

Employee

Benefits from restricted stock are taxed upon grant. RSUs are taxed upon vesting.

Shares acquired before January 1, 2011: gains from the sale of shares held more than 12 months generally are not taxed. If the shares were held less than 12 months gains are taxed.

Gains from the sale of shares acquired on or after January 1, 2011 are subject to tax irrespective of the holding period.

Employer

Withholding & Reporting

Tax withholding and reporting are required.

Deduction

Reimbursement of the parent company for the cost of the benefit pursuant to a written reimbursement agreement should enable the subsidiary to deduct such cost from its income taxes.

Tax-favored

In case of a direct participation in the company and economic ownership of the employee (not only by means of funds) preferential tax treatment may apply if certain requirements are met.

Last modified 7 Jun 2024

Social insurance contributions are payable on restricted stock and RSUs, subject to a cap. Withholding is required.

Last modified 7 Jun 2024

All data protection requirements must be met. Strict rules apply to data transfer outside the EEA.

Last modified 7 Jun 2024

Benefits received from restricted stock and RSUs may be considered as part of the employment relationship and thus, included in a possible severance payment if restricted stock and RSUs are regularly granted to an employee. Upon termination of employment, an employee may be entitled to continued vesting and other rights with respect to his or her award. Such entitlement risks can be mitigated contractually by the parties for certain cases. In order to reduce the risk of claims, the award agreement signed by an employee should provide, among other things, that the vesting of restricted stock and RSUs ceases upon termination of employment, and that the plan and any awards under it are discretionary. In addition, anti-discrimination rules need to be considered when awarding restricted stock or RSUs. If the Austrian employer has a works council, prior notice should be given before an offer is made.

Last modified 7 Jun 2024

Although plan materials are not required to be translated initially, a German translation might be necessary at a later stage.

Last modified 7 Jun 2024

The EU Prospectus Directive has been implemented into Austrian law. Even if purchase rights are considered securities that require a prospectus, they may nonetheless be exempt from the prospectus requirements (eg, the 150-person exemption or other exemptions).

Last modified 7 Jun 2024

Reporting to the Austrian National Bank is required under certain circumstances.

Last modified 7 Jun 2024

Employee 

Generally, the benefit upon purchase is subject to tax (the difference between the reduced purchase price and the market value).

Shares acquired before January 1, 2011: gains from the sale of shares held more than 12 months generally are not taxed. If the shares were held for less than 12 months, gains are taxed.

Gains from the sale of shares acquired on or after January 1, 2011, are subject to tax irrespective of the holding period.

Employer

Withholding & Reporting

Tax withholding and reporting, especially the proof of the holding period, are required.

Deduction

Reimbursement of the parent company for the cost of the benefit (ie, the discount at the time of purchase) pursuant to a written reimbursement agreement should enable the subsidiary to deduct such cost from its income taxes.

Tax-favored

Preferential tax treatment, in the form of a designated tax-exempt amount for the given benefit, may apply if certain requirements are met.

Last modified 7 Jun 2024

Social insurance contributions are payable on the spread, subject to a cap. Withholding is required.

Last modified 7 Jun 2024

Strict rules apply to data transfer outside the EEA.

Last modified 7 Jun 2024

Benefits received from restricted stock and RSUs may be considered as part of the employment relationship and thus, included in a possible severance payment if restricted stock and RSUs are regularly granted to an employee. Upon termination of employment, an employee may be entitled to continued vesting and other rights with respect to his or her award. Such entitlement risks can be mitigated contractually by the parties for certain cases. In order to reduce the risk of claims, the award agreement signed by an employee should provide, among other things, that vesting of restricted stock and RSUs ceases upon termination of employment, and that the plan and any awards under it are discretionary. In addition, anti-discrimination rules need to be considered when awarding restricted stock or RSUs. If the Austrian employer has a works council, prior notice should be given before an offer is made.

Last modified 7 Jun 2024

Although plan materials are not required to be translated initially, a German translation might be necessary at a later stage. 

Last modified 7 Jun 2024