Stock Options for Employees in Ireland

Stock options for employees in Ireland

Equity incentives are an invaluable way to attract, motivate, and retain top talent for your business. But when you cross hiring borders, they can become deeply complex.

Remote enables you to easily offer non-qualified stock options (NSOs) to your team members in Ireland. There are no compliance headaches or administrative hassles — just simplicity and clarity for you and your people at every step.

What are NSOs?

NSOs are a type of equity incentive. They give your team members the right to buy a set number of shares in your company at a fixed price, known as the exercise price.

This typically happens after a vesting period, which is often based on the length of time your team member stays at your company. As a result, they are a great way to foster long-term commitment, and align people with your company’s strategic goals.

Who can receive NSOs in Ireland?

	Direct employees	EOR employees	Contractors
Can receive NSOs?	Yes	Yes	Yes
Difficulty score	Easy	Easy	Hard

It’s important to note that granting stock options to contractors can potentially increase your misclassification risk in Ireland (although this is not the primary factor). See how Remote protects you against misclassification.

How are NSOs taxed in Ireland?

In Ireland, NSOs are taxed in the following ways:

	Direct employees	EOR employees	Contractors
At grant	There is no taxation at grant, except under certain conditions.	There is no taxation at grant, except under certain conditions.	The tax treatment of the gain made upon exercise of the stock options depends on the individual circumstances of the contractor. There is no specific law or guidance on this, and it’s not common to offer stock options to contractors in Ireland. As a result, it’s recommended that your contractor consult a personal tax advisor. That said, it’s likely that taxation should take place at the time of exercise (with the spread to be reported as trading income), and at the time of sale (with the gain to be reported as a capital gain).
At exercise	The spread is taxed as salary income. The spread is the difference between the fair market value of the shares at the time of exercise, and the exercise price (or “strike” price) paid by your team member.	The spread is taxed as salary income. The spread is the difference between the fair market value of the shares at the time of exercise, and the exercise price (or “strike” price) paid by your team member.
At sale	The gain is taxed as capital gain.	The gain is taxed as capital gain.

Are there tax advantages for your team members?

Direct employees	EOR employees	Contractors
You can allow your team members to exercise their non-vested stock options early (a process known as “early exercise”). This can potentially reduce their tax liability, although early exercises can be difficult to manage and may require additional paperwork.	You can allow your team members to exercise their non-vested stock options early (a process known as “early exercise”). This can potentially reduce their tax liability, although early exercises can be difficult to manage and may require additional paperwork.	There is no clear tax-favored scheme in Ireland.

Is your business eligible?

If you want to use Remote Equity Advanced to offer stock options to your Ireland-based team members, your top corporation (i.e., your parent company) must be incorporated in Delaware. Your company must also be private — not publicly listed.

Talk to us now

Book a meeting

Easily manage employment in Ireland