2018 Global Employee Equity at a glance: Singapore | White & Case LLP International Law Firm, Global Law Practice
2018 Global Employee Equity at a glance: Singapore

2018 Global Employee Equity at a glance: Singapore

Welcome to the Singapore page of our Global Employee Equity at a glance series. To view other countries in this series, please visit our 2018 Global Employee Equity at a glance page.

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TABLE OF CONTENTS

Stock Option Plans
Employment
Regulatory
Tax

Restricted Stock and RSUs
Employment
Regulatory
Tax

Employee Stock Purchase Plans
Employment
Regulatory
Tax

 

Stock Option Plans: Employment

Labor Concerns

There is a risk of employees claiming that they are entitled to compensation for loss of rights under the Plan where the Plan is amended or discontinued or where their employment is terminated.

Singapore's employment framework, comprising statutory law, case law and guidelines, advisories and standards issued by the tripartite partners, generally discourages discrimination against, and/or less favorable treatment of, employees on certain grounds, including age and part-time status. Companies should be mindful of this when determining the eligibility of employees to participate in the Plan, the benefits being granted and the exercise of any discretion.

Communications

A disclaimer should be included in the award agreement that acknowledges each employee's receipt of the Plan documents and the discretionary nature of the Plan and confirms that termination of employment will result in the loss of unvested rights.

Government filings can generally be made in English.

No rule or regulation prohibits electronic execution of awards agreements.

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Stock Option Plans: Regulatory

Securities Compliance

Neither the grant nor the exercise of Options is likely to trigger any prospectus requirements.

Foreign Exchange

There are no foreign exchange restrictions applicable to the Plan.

Data Protection

Processing of employee data for purposes directly connected to the employment relationship can generally be justified on the basis that the processing is necessary to fulfill the contract of employment. The employer is generally still required to notify the employee of the purposes for which they are processing employee data. Purposes outside that category need to be assessed on a case- by-case basis. Consent should be obtained from the employee in all other cases and specific opt-in consent may be required in some cases.

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Stock Option Plans: Tax

Employee Tax Treatment

An employee is generally subject to income tax on the gain on exercise (i.e., the excess of the market value of the Stock acquired over the aggregate exercise price).

Capital gains tax is not payable on any gain upon the net proceeds of sale of the Stock, unless the employee is regarded as trading or dealing in securities.

Social Security Contributions

Social security contributions are not due from either the Subsidiary or the employee provided that such awards are not cash-settled.

Tax-Favored Program

Employees may receive a partial tax exemption or deferral of taxation (subject to an interest charge) with respect to gains derived from the Plan where certain conditions are met. These exemptions only apply to gains arising from Options granted on or before December 31, 2013, as long as the gains are derived on or before December 31, 2023.

Withholding and Reporting

The Subsidiary generally has no obligation to withhold, unless employees are:

(i) leaving employment and are not citizens or permanent residents of Singapore; or

(ii) permanent residents leaving Singapore permanently.

The Subsidiary has certain tax reporting obligations

Employer Tax Treatment

A deduction is not available to the Subsidiary unless treasury shares are used to settle the awards and certain conditions are met.

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Restricted Stock and RSUs: Employment

Labor Concerns

There is a risk of employees claiming that they are entitled to compensation for loss of rights under the Plan where the Plan is amended or discontinued or where their employment is terminated.

Singapore's employment framework, comprising statutory law, case law and guidelines, advisories and standards issued by the tripartite partners, generally discourages discrimination against, and/or less favorable treatment of, employees on certain grounds, including age and part-time status. Companies should be mindful of this when determining the eligibility of employees to participate in the Plan, the benefits being granted and the exercise of any discretion.

Communications

A disclaimer should be included in the award agreement that acknowledges each employee's receipt of the Plan documents and the discretionary nature of the Plan and confirms that termination of employment will result in the loss of unvested rights.

Government filings can generally be made in English.

No rule or regulation prohibits electronic execution of awards agreements.

[Go back to top of page]

 

Restricted Stock and RSUs: Regulatory

Securities Compliance

Neither the grant nor the vesting of Restricted Stock or RSUs is likely to trigger any prospectus requirements.

Foreign Exchange

There are no foreign exchange restrictions applicable to the Plan.

Data Protection

Processing of employee data for purposes directly connected to the employment relationship can generally be justified on the basis that the processing is necessary to fulfill the contract of employment. The employer is generally still required to notify the employee of the purposes for which they are processing employee data. Purposes outside that category need to be assessed on a case- by-case basis. Consent should be obtained from the employee in all other cases and specific opt-in consent may be required in some cases.

[Go back to top of page]

 

Restricted Stock and RSUs: Tax

Employee Tax Treatment

For both Restricted Stock and RSUs, an employee is generally subject to income tax on vesting. Capital gains tax is not payable on any gain upon the net proceeds of sale of the Stock, unless the employee is regarded as trading or dealing in securities.

Social Security Contributions

Social security contributions are not due from either the Subsidiary and the employee provided that such awards are not cash-settled.

Tax-Favored Program

Employees may receive a partial tax exemption or deferral of taxation (subject to an interest charge) with respect to gains derived from the Plan where certain conditions are met. These exemptions only apply to gains arising from Restricted Stock or RSUs granted on or before December 31, 2013, as long as the gains are derived on or before December 31, 2023.

Withholding and Reporting

The Subsidiary generally has no obligation to withhold, unless employees are: (i) leaving employment and are not citizens or permanent residents of Singapore; or (ii) permanent residents leaving Singapore permanently.

The Subsidiary has certain tax reporting obligations.

Employer Tax Treatment

A deduction is not available to the Subsidiary unless if treasury shares are used to settle the awards and certain conditions are met.

[Go back to top of page]

 

Employee Stock Purchase Plans: Employment

Labor Concerns

There is a risk of employees claiming that they are entitled to compensation for loss of rights under the Plan where the Plan is amended or discontinued or where their employment is terminated.

Singapore's employment framework, comprising statutory law, case law and guidelines, advisories and standards issued by the tripartite partners, generally discourages discrimination against, and/or less favorable treatment of, employees on certain grounds, including age and part-time status. Companies should be mindful of this when determining the eligibility of employees to participate in the Plan and the exercise of any discretion.

Communications

A disclaimer should be included in the award agreement that acknowledges each employee's receipt of the Plan documents and the discretionary nature of the Plan and confirms that termination of employment will result in the loss of unvested rights.

Government filings can generally be made in English.

No rule or regulation prohibits electronic execution of awards agreements.

[Go back to top of page]

 

Employee Stock Purchase Plans: Regulatory

Securities Compliance

Neither the grant nor the exercise of purchase rights is likely to trigger any prospectus requirements.

Foreign Exchange

There are no foreign exchange restrictions applicable to the Plan.

Data Protection

Processing of employee data for purposes directly connected to the employment relationship can generally be justified on the basis that the processing is necessary to fulfill the contract of employment. The employer is generally still required to notify the employee of the purposes for which they are processing employee data. Purposes outside that category need to be assessed on a case- by-case basis. Consent should be obtained from the employee in all other cases and specific opt-in consent may be required in some cases.

[Go back to top of page]

 

Employee Stock Purchase Plans: Tax

Employee Tax Treatment

An employee is generally subject to income tax on the value of the discount when Stock is purchased.

Capital gains tax is not payable on any gain upon the net proceeds of sale of the Stock, unless the employee is regarded as trading or dealing in securities.

Social Security Contributions

Social security contributions are not due from either the Subsidiary and the employee provided that such awards are not cash-settled.

Tax-Favored Program

Employees may receive a partial tax exemption or deferral of taxation (subject to an interest charge) with respect to gains derived from the Plan where certain conditions are met. These exemptions only apply to gains arising from awards granted on or before December 31, 2013, as long as the gains are derived on or before December 31, 2023.

Withholding and Reporting

The Subsidiary generally has no obligation to withhold, unless employees are: (i) leaving employment and are not citizens or permanent residents of Singapore; or (ii) permanent residents leaving Singapore permanently.

The Subsidiary has certain tax reporting obligations.

Employer Tax Treatment

A deduction is not available to the Subsidiary unless treasury shares are used to settle the awards and certain conditions are met.

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2018 Global Employee Equity at a glance

Employment, Compensation & Benefits practice group

 

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