GEO INSIGHTS

The New Zealand Government’s new tax bill introduces measures to attract migrants and ease compliance, including a special “non-resident visitor” rule allowing digital nomads to work in New Zealand for up to 275 days without income tax, and a new foreign investment fund calculation method (RAM) to simplify tax for migrants on overseas shares. Key domestic changes include deferred tax timing for employee share schemes in unlisted companies, phased increases to KiwiSaver employer contributions, and tax exemptions for income from residential solar electricity sales. Other updates clarify SaaS exemptions from non-resident contractors’ tax, align PIE rules for cryptoassets, and repeal certain trust disclosure and taxpayer information provisions to simplify reporting.

Employee Stock Ownership Plans (ESOPs) are experiencing a resurgence in 2025, moving beyond manufacturing into mainstream industries as regulators and lawmakers push for broader employee ownership and new financing options. ESOPs offer powerful tax advantages and succession planning benefits, but they come with costs, complexity, and long-term obligations, prompting some businesses to consider Employee Ownership Trusts (EOTs) as a simpler alternative focused on legacy and cultural continuity. For business owners, the choice between ESOPs, EOTs, or other succession strategies ultimately depends on priorities such as liquidity, tax efficiency, employee retention, and preserving company values.

The Federal Board of Revenue (FBR) has granted tax exemptions for employee share schemes under the Income Tax Ordinance 2001 for the 2025–26 tax year, removing immediate tax liability when options are granted. Tax is only applied later, depending on the scheme’s structure—such as when transfer restrictions are lifted, shares are issued, or rights/options are sold. This reform is designed to encourage companies to adopt share schemes, align employee incentives with company growth, and ease tax burdens for workers.

In South Africa, mergers are now scrutinized not only for competition effects but also for public interest, with employee share ownership plans (ESOPs) becoming a decisive factor for approval. The 2024 guidelines mandate measurable increases in black and worker ownership, meaning even competitively neutral mergers can be blocked without transformative ownership structures. For multinationals, ESOPs are no longer compliance formalities but strategic tools to secure approvals, align with national transformation goals, and build inclusive, sustainable businesses.

The One Big Beautiful Bill Act of 2025 (OBBBA) brings several tax changes that affect equity compensation, including raising the SALT deduction cap from $10,000 to $40,000 through 2029, though the benefit phases out for incomes above $500,000. It also alters Alternative Minimum Tax (AMT) rules beginning in 2026, making it more likely high earners exercising incentive stock options will trigger the AMT. Additionally, the law expands Qualified Small Business Stock (QSBS) benefits and shortens holding periods for capital gains exclusions, while adding new limits on charitable deductions starting in 2026.

Admiral Group reported a 69% rise in first-half 2025 profit before tax to £521 million, with earnings per share up 72% and an interim dividend of 115p declared. Growth was driven by strong UK performance—motor profits rose 56% and household and money businesses more than doubled—alongside a 10% increase in customers to 11.4 million, though European insurance customers fell 3%. The group continued its record momentum from 2024, investing in technology and rewarding 13,000 employees with free shares, while maintaining a robust solvency ratio of 194%.

This helpsheet explains how Capital Gains Tax (CGT) applies to shares acquired through employee share schemes, including SIPs, SAYE, CSOPs, EMIs, and unapproved schemes. It outlines how to calculate the capital gains cost of shares, available reliefs (such as transfers to ISAs, pensions, or SIPs), and specific rules for restricted or same-day share acquisitions. It also details special provisions for Employee Shareholder Shares (ESS), including lifetime gain limits, and provides guidance on elections, claims, and compliance requirements.