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For a German resident with options in a US company, would I also be able to transfer those options to an UG and then get taxed 5%?
by mousetree 4y ago
For a German resident with options in a US company, would I also be able to transfer those options to an UG and then get taxed 5%?
- daanlo 4y agoI am neither a lawyer, nor tax advisor, but my layman understanding is: If you transfer them (as in, you already own them as a private person and give/sell them to your UG), you will generate a taxable event where you might have to pay personal income tax on the current market value of the options. You probably don‘t want this to happen. If you don‘t yet own them, then you might be able to set it up with your employer that shares are held my your holding. There are some explicit rules around being actively involved in the company and whether the 5% rule applies. I don‘t know the latest status quo of this and whether employee options would generally qualify for the 5% rule. You only pay 5% of the tax. So if the corporate tax rate is 20%, your effective tax rate is 1%.
- ck_one 4y agoThat's a good question! I don't see a reason why it shouldn't work. There shouldn't be a difference between a founder holding shares and an employee holding shares. Not sure how options play into it though.