A change in taxation of share options took effect in July 2017, addressing full exit, changes in the underlying asset and notifying the tax authorities about share option agreements.

If the underlying asset to which the option refers are a holding in the employer or a company that belongs to the same group as the employer, then acquisition of the holding is still not taxed as a fringe benefit if the holding is acquired not earlier than three years as of the grant of the share option (concluding the option agreement).

In practice, share option agreements have been backdated to shorten the three-year period. To avoid that, a requirement was introduced to notify the tax authorities about concluding an agreement within five business days of doing so. This does not apply to option agreements that are notarized or digitally signed.

In the case of full exit (sale of 100% of the shareholding in the employer or employer’s group company) or the employee’s death or incapacity for work, the tax exemption regulation was softened. If such an event occurs within the three-year period, the tax exemption is applied proportionally.