Private ruling: Employee share scheme
Date of advice: 18 November 2025
Published: 5 January 2026
Ruling period: 1 July 20XX to 30 June 20YY
Date scheme commenced: DDMMYYYY

Ruling: Q1: Will the irretrievable cash contributions that are made the Company to the Trust, to fund the subscription for, or acquisition of, ordinary shares in the Company pursuant to the Plan be assessable income of the Trust under sections 6-5 or 6-10 of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: No. | Q2: Will any capital gain or capital loss that arises for the trustee of the Trust at the time when CGT Event E5 happens, in relation to the shares in the Company held by the Trust, be disregarded under section 130-90 of the ITAA 1997, if the participants acquire the shares for the same or less than the cost base of the shares in the hands of the trustee? | A2: Yes.

Relevant facts and circumstances: The Company is a company that is incorporated in Australia with its shares listed on the Australian Securities Exchange. The Company is an Australian resident for income tax purposes and is the head company of a consolidated group. The Company is not an employer entity, but some subsidiary members of the consolidated group are. The Company derives assessable income from its business activities. The Company operates an employee share scheme as part of its remuneration and reward program for the group's employees (the Plan). The Plan is governed by the Plan Rules. Under the Plan, participants are granted option rights to acquire shares in the Company for no consideration. The options are subject to vesting conditions until the relevant vesting date. Upon vesting, the participants may exercise their options and receive the relevant number of shares in the Company. The Company will make cash contributions to the Trust from time to time to fund the acquisition of shares in the Company, after options are granted to participants. These contributions are irretrievable and non-refundable because the Company and its subsidiaries are not beneficiaries of the Trust and are not entitled to any part of the Trust fund (including shares held by the Trust). The cash contributions form part of the corpus of the Trust.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 6-5 | Income Tax Assessment Act 1997 section 6-10 | Income Tax Assessment Act 1997 section 83A-10 | Income Tax Assessment Act 1997 section 100-25 | Income Tax Assessment Act 1997 section 104-75 | Income Tax Assessment Act 1997 section 130-85 | Income Tax Assessment Act 1997 section 130-90