Shareworks Global Intelligence Newsletter June 2020

June 1, 2020 Shareworks Marketing

Icon of a globe with a network connecting countries together with the wording "Global Intelligence Newsletter" underneath.

Shareworks Global Intelligence newsletter provides an overview of recent changes affecting employee share plans globally. 

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We have made some exciting changes to our monthly Shareworks Global Intelligence newsletter. Starting with this month’s newsletter, you will receive updates for all countries, regardless of your subscription.This will help you stay ahead globally! You can easily skip to the countries you are currently subscribed to by using the spotlight icon below. 

We also want your feedback! To ensure we are continuously enhancing our products and solutions, to better help you access the information you need, we are planning to set up a few interviews with clients and our user experience (UX) team. If you would like to be a participant in our UX survey, please send us a note and we can coordinate a time that works for you. 

Please find below the Shareworks Global Intelligence overview of certain changes affecting employee share plans globally. This issue also highlights certain upcoming global filing and reporting requirements (for the parent company or local company). 

As always, please feel free to contact us if you need further assistance.

 

Country Updates

Argentina: New Reporting Requirements

Effective from April 15, 2020, the tax authorities implemented new information reporting requirements, as detailed below. All information must be submitted electronically through the website of the Administración Federal de Ingresos Públicos.

Argentine resident companies (among other vehicles) must report ownership rights in their capital or equity by resident and non-resident individuals, non-resident legal entities and other ownership structures. They must also report related parties. In all cases, the ultimate individual beneficial owner must be identified.

The reporting must be completed between July 28-July 30 following the reported year, with the specific date depending on the tax ID of the reporter. For calendar year 2019, the reporting must be done between October 28 – 30, 2020.

Resident companies must also report any change of top executives and board members within 10 working days of the appointment.

Resident individuals must report any ownership of or participation in the capital of local or foreign companies, as well as any management or director positions in such entities.

Residents who sell and/or acquire shares and other rights of local or foreign companies must report these transactions within 10 working days of the transaction date.

This information has been provided by our collaborating law firm in Argentina, Nicholson y Cano Abogados (contact: Cecilia M Martin at cmartin@nyc.com.ar)

 

India: Introduction of Dividend Withholding Tax

Effective April 1, 2020, India introduced a 20% dividend withholding tax on dividends distributed by Indian companies that are received by non-resident investors. A surcharge and a 4% tax will also be applicable on dividends, with the rate of the surcharge depending on the taxable income amount and the type of investor.

Previously, dividends distributed by Indian companies were exempt in the hands of both residents and non-residents.

Dividends declared on or before March 31, 2020 but paid after April 1, 2020 will continue to be exempt from the new dividend withholding tax, provided that the company has paid dividend distribution tax.

This information has been provided by our collaborating law firm in India, Little & Co. (contact: Rajni Divkar at rajni.divkar@littlecompany.com)

 

Puerto Rico: Tax Reform Bill

On April 16, 2020, a Tax Reform Bill was approved in Puerto Rico. The bill, applicable to taxable years beginning after December 31, 2019, introduces an additional 3% income tax reduction in the form of a tax credit for taxpayers whose annual income does not exceed USD 100,000. 

By applying the new tax credit along with the existing 5% tax credit, individuals with a gross income not exceeding USD 100,000 will have a tax liability equal to 92 percent of the sum of the amounts determined according to the general progressive individual income tax rates. 

This information has been provided by our collaborating law firm in Puerto Rico, Casillas, Santiago & Torres, LLC (contact: Miguel A. Santiago at msantiago@cstlawpr.com)

 

Russia: Proposal of Income Tax Exemption

On April 15, 2020, a draft law was submitted to the Russian parliament proposing that salary amounts not exceeding two times the minimum monthly salary (RUB 12,130 in 2020) be exempt from individual income tax. Further developments will be reported once known.

This information has been provided by our collaborating law firm in Russia, ALRUD (contact: Olga Pimanova at opimanova@alrud.com)

 

Sri Lanka: Elimination of Tax Withholding Obligation

With retrospective effect from January 1, 2020, the Sri Lanka Inland Revenue Department has eliminated the tax withholding obligation on payments made to Sri Lankan tax residents, including dividends and the Pay-As-You-Earn withholding on employment income.

Accordingly, individual taxpayers are required to declare their income in their income tax return and make income tax payments in quarterly installments directly to the local tax authority.

With effect from April 1, 2020, employees with gross remuneration exceeding Rs. 250,000 per month or Rs. 3,000,000 for a year of assessment, can request that Advance Personal Income Tax be deducted by the employer.

This change has not been enacted yet by means of amending the relevant legislation, and clarification will be needed on a number of matters, including the impact of the new rules on employee share plans. Further developments will be reported once known.

This information has been provided by our collaborating law firm in Sri Lanka, John Wilson Partners, Attorneys-at-Law & Notaries Public (contact: John Wilson at john@srilankalaw.com

 

AUSTRALIA EMPLOYEE SHARE SCHEME STATEMENT

If you are a Shareworks equity administration client and would like to learn more about how Shareworks can support your annual ESS requirements, please click here or reach out to your personal contact.

 

Upcoming Filing and Reporting

India: Tax Deducted at Source Certificate

May 31, 2020
Affects: Local Company

Employers in India must issue a Tax Deducted at Source (TDS) certificate on Form 16 to employees by May 31 following the end of the financial year. Form 16 sets out any tax withheld by the employer in the previous year, including withholdings under equity plans.

In addition, Form 12BA must also be issued to employees by April 30 of the assessment year. 

This information has been provided by our collaborating law firm in India, Little & Co. (contact: Rajni Divkar at rajni.divkar@littlecompany.com)

 

Portugal: Equity Reporting

June 30, 2020
Affects: Local Company

Employers in Portugal must submit Form Modelo 19 with details of the creation and application of all share plans set up for the benefit of its employees by 30 June following the tax year.

This information has been provided by our collaborating law firm in Portugal, Abreu & Marques Associados (contact: Cidália Conceição at cidalia.conceicao@amsa.pt)

 

China: SAFE Quarterly Reports

July 3, 2020
Affects: Local Company

Companies that have obtained SAFE approval for their equity plans in China are required to file quarterly reports with their local SAFE office within three business days following the end of the relevant quarter.

This information has been provided by our collaborating law firm in China, Martin Hu & Partners (MHP) (contact: Kevin Xu at kevin.xu@mhplawyer.com)

 

Saudi Arabia: Quarterly Equity Reporting

July 10, 2020
Affects: Parent Company

Companies offering share plans to employees in Saudi Arabia under the revised securities law exemption must notify the Capital Market Authority (“CMA”) within 10 days after the end of the quarter following grant disclosing the total number and value of all offers made to employees during the preceding quarter. This notification can be made by an authorised person or by the company. Plan amendments or changes may also require additional filings with the CMA.

This information has been provided by our collaborating law firm in Saudi Arabia, Tamimi (contact: Grahame Nelson at g.nelson@tamimi.com)

 

Australia: Employee Share Scheme Statement

July 14, 2020
Affects: Local Company

The annual reporting deadline for Australian employers is approaching. Companies that have a presence or employees in Australia and operate an equity plan must issue an Employee Share Scheme Statement to each employee who had a reportable taxing point in the prior tax year by July 14. In addition, an Employee Share Scheme Annual Report must be electronically filed with the Australian Taxation Office by August 14.

This information has been provided by our collaborating law firm in Australia, Minter Ellison (contact: Nicole Sloggett at nicole.sloggett@minterellison.com)

 

India: Employer Tax Filings

July 15, 2020
Affects: Local Company

Indian employers are required to file Form 24Q with the Indian tax authorities on a quarterly basis. These quarterly returns report information on employment income paid to employees (including from share-settled awards) as well as taxes withheld.

The quarterly returns must be submitted by:

  • May 31 for the quarter ending March 31
  • July 31 for the quarter ending June 30
  • October 31 for the quarter ending September 30
  • January 31 for the quarter ending December 31
This information has been provided by our collaborating law firm in India, Little & Co. (contact: Rajni Divkar at rajni.divkar@littlecompany.com)

 

Upcoming Events

GEO's Global Share Plan Basics Bootcamp

August 12, 2020

The bootcamp will be organized at the Renaissance Nashville Hotel in Nashville, Tennessee. It is designed to be either a standalone one-day program or for those wishing to also attend GEO’s 21st Annual Conference, GEO offers a combined program option.

Registration is now open.

More info: https://www.globalequity.org/geo/Nashville2020-Bootcamp

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Shareworks, Shareworks Global Intelligence and all product marks and logos are trademarks of Shareworks.THIS INFORMATION IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL OR TAX ADVICE. You should always consult with and rely on your own legal and/or tax advisor(s) as Shareworks does not provide legal or tax advice and the information is not tailored to the specific situations of your company or your employees. The information is sourced from third parties, may not be current and is subject to change without notice. Shareworks makes no representations or warranties concerning the accuracy, completeness or timeliness of the information and is not implying an affiliation, sponsorship or endorsement with/of any third parties (including those hosting and presenting at third-party events) or views expressed by such parties. Any views expressed are solely those of the third-party source. Shareworks shall have no liability arising out of, or in connection with, the information, including any loss caused by use of, or reliance on, the information. All information made available by Shareworks is subject to the terms of the written agreement entered into between Shareworks and your company.