“SCARRABELOTTI recommends remuneration funding as the most effective method of financing Division 13A Exempt and Deferred share plans; these are then reallocated to the share plan which acquires shares on behalf of employer.”

Aequum Managing Director
Gary Scarrabelotti

Employee benefits  …

'“By investing pre-tax dollars in the ESOP, employees acquire (depending on their marginal tax rate) up to twice the number of shares they could have purchased using post-tax savings.”

Employer benefits ...

“Remuneration funding means, for the employer, a tax deduction to the company for every dollar contributed to the ESOP”

Division 13A Share Plans

Funding '13A' Share Plans

How the plans work

Alternative ESOP Funding Mechanisms

Loan Plans

ESOP Leveraging

Want help?

Division 13A Share Plans

Division 13A of the Income Tax Assessment Act provides for:

•          A share plan which offers at least three-quarters of permanent employees of 3 years standing an ordinary share in the employer’s company;
  
  

•          A Tax-Exempt model (Exempt Plan) under which employees can receive up to $1,000 worth of shares per year;
  
  

•          A Tax-Deferred model (Deferred Plan) under which employees can defer tax liabilities for up to 10 years;
  
  

•          Up to 5% of the firm’s voting shares per individual employee;
  
  

•          Full tax-deductibility for employer contributions to an ESOP.
  
  

•          An Option plan which can always be targeted to a select group of employees.
  

Funding '13A' Share Plans

How the plans work

Alternative ESOP Funding Mechanisms

Loan Plans

ESOP Leveraging

Want help?