Employee Share Plans in Europe and the USA - Sorainen

Employee Share Plans in Europe and the USARepublic of Ireland8. Data protectionEmployee consent must be obtained for the collection, processing and worldwidetransfer of personal data in connection with an employee share plan. 16• the trustees must be Irish residents and at least one of the trustees must be a professionaltrustee.• The tax position of the Revenue approved ESOT is as follows:• the trustees are liable to income tax at the standard rate on the income of the trust;• the transfer of shares directly by the trustees to beneficiaries will be disposals for Capital GainsTax (CGT) purposes and any chargeable gain will be taxable at 25% on disposals made on orafter 8 April 2009;• the transfer of shares by the trustees to Revenue approved profit sharing schemes will beexempt from CGT; and• the sale of shares in the open market by the trustees will be exempt from CGT where theproceeds are used to repay borrowings.• The tax position of the beneficiaries is as follows:• no tax consequences arise as a result of being a beneficiary of the trust;• a tax charge will arise on the transfer of shares by the trustees directly to beneficiaries. Theamount will be liable to income tax at the marginal rate of tax of the beneficiary, and theobligation will be on the beneficiary to include the taxable benefit in their tax return;• no tax liability will arise on the employee where the shares are transferred from a Revenueapproved profit sharing scheme.• The tax position of the company is as follows:• the company can claim a tax deduction for the costs incurred in setting up a Revenue approvedESOT. The company can also claim a tax deduction for contributions to the trustees providedthe trustees spend those contributions on "qualifying purposes" during the "expenditure period";• the qualifying purposes are:- the acquisition of shares in the company setting up the ESOT;- the repayment of loans;- the payment of interest on loans;- the payment of any sum to a person who is a beneficiary under the trust; and- to meet expenses;• the expenditure period is within nine months of the end of the accounting period in which thecosts and contributions are made by the company, or longer with the approval of the RevenueCommissioners.• The Revenue Commissioners may give notice in writing to the company of any information theyrequire in order to satisfy themselves that the ESOT continues to qualify for Revenue approval andto determine the tax liability of any beneficiary under a Revenue approved ESOT.16In Ireland, the Data Protection Acts 1988 and 2003 impose certain obligations in respect of "personaldata" (i.e. data relating to living individuals) which is in electronic form or manual data held in a relevantUK/1729295/03 111 September 2010