The Dutch government is working on new taxation rules for employment related stock options. This new regulation is meant for startups, scale-ups, fast-growing small and medium-sized enterprises with the aim of stimulating innovative companies and attracting talents.
The new tax rules provide for a lower tax rate in box 1 for employees, by reducing the taxable base of income from stock options to 65% instead of 100%. Furthermore, there will be an option for deferred taxation at the time of the actual sale of the acquired shares. The expected date for the implementation of these new tax rules is 1 January 2027.
In the meantime, the benefit from stock options will be taxed when the shares become tradeable. This applies to both existing and new stock option plans. However, eligible employees still have the option to choose for taxation upon exercise. If they like to do so, the employer must be informed about this decision in time and ultimately at the time of exercise. In cases whereby the acquired shares are tradable immediately, the options will remain taxable when the stock option rights are exercised.
