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Stock Options in Startups – A scam or something worth a shot?

Article text size A. This blog post intends to be for tech people who will hopefully be able to understand and judge better what you are really offering when stock options are part of the offer. This should only take a few moments. Should I join a startup offering stock options? Kerviel was fired, but he claimed the bank was being unfair. You can read more details about all this here. Senior iOS Engineer September 12,

Inicialmente el Tribunal Supremo no entraba a cuantificar el importe de la retribución obtenida como consecuencia del ejercicio de stock options, es en su sentencia de 1 de octubre de cuando el Alto Tribunal afirmó que “la utilidad patrimonial que obtiene el beneficiario de la opción está así constituida por la diferencia entre el precio de la .

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NEVER treat them as a bonus or extra salary. If you are a founder or work in HR and tell people you offer stock options to compensate a lower salary you are just trying to scam them. This is not against you, former employers. This blog post intends to be for tech people who will hopefully be able to understand and judge better what you are really offering when stock options are part of the offer. If something I say here is not accurate or just complete bollocks, please feel free to comment or email me and I will amend the blog post so that it reflects the reality as accurately as possible.

Most of you possibly know about this one but I did not before I had my first stock options contract so I guess it is worth reminding. And realistically, in early stage startups you will rarely be able to do it unless you stay for the whole period. Think about it, you have worked your ass for 4 years in that place but you decide to leave because you are tired of getting a lower salary or you just want to do something else.

Not cool at all, right? This is an obvious one but I did not realise it until it happened to me. Most importantly, if the founders did not have any intentions to sell the company or go IPO any soon, unless there are other execution events planned, they are totally useless. These are relatively limited, as it is mostly either someone buying the company or going IPO.

Or for instance, the company may get acquired by a bigger player and this may be an execution event after the new valuation happens. It really depends on the deal your company got with the buyers, new VCs or any parties involved in the event.

A group of founders may have a deal closed under the table, make most of the team redundant alleging bad finances and 4 months later execute the deal. Everybody will have lost the stock options but the ones standing! This is much fairer approach IMHO although I am not sure about the exact legal details as it has never happened to me yet. You can read a comparison with the usual stock here. They are similar to the ISO stock as there is an associated vesting period and conditions to be able to exercise.

But unlock the stock options there is no purchase involved, so they can be a better deal if your startup valuation has gone crazy and so has the stocks execution price. After vesting, RSUs are transferrable if the employee accepts the grant. And they have a defined value: In contrast, Options that can decline in value by the time of vesting. I think this is a more realistic approach in many situations, founders and potential VCs keep their stock and employees get a bonus when things go great for everybody.

There are other types of stock but it is rare that you get them in startups. If someone has experiences with different situations, please share! Be very careful about this one. And in the event of a selling, preferred stock holders get a guaranteed amount of money from the sale.

You can read more details about all this here. You made it, you stayed for 4 years and 1 month, the company just got sold and you can execute your stock options. You have been for 3 years, the company is going really well but you get a very interesting offer somewhere else. You are leaving the company but you can execute your stock options nonetheless check your execution events and you decide to explore this option as you genuinely believe the company will sell eventually and you will be able to cash out.

If there is a new valuation and your stock is potentially worth double you will be taxed by this potential gain, even though you are technically not able to cash it! This will be taxable to you, not as a capital gain, but as employment income. Most stock option plans in Canada are structured to take advantage of a stock option deduction equal to 50 per cent of the taxable benefit. But the story isn't over. Where are you going to get the money to pay your tax bill?

The loss is considered to be a capital loss, whereas the taxable income was considered to be employment income. Capital losses can be applied against capital gains, but not generally other types of income.

You'll face tax on the stock options with no immediate relief from the loss. There have been a few court cases in the past on this issue. Bing Zhu, a Canadian taxpayer, was the most recent casualty of the courts see Bing Zhu v.

The Queen, TCC Zhu had acquired , shares in his employer, Canadian Solar Inc. CSI and in September, , exercised his options and acquired 53, shares in his employer. He tried to argue that his losses were not capital losses, but regular business losses, in an attempt to have his losses applied against his employment income.

The court ruled against him. Even though it may not be fair to Mr. Zhu, the court had no authority to give relief based on an argument of fairness. To avoid the fate of Mr. Zhu and so many others, consider selling any shares acquired under a stock option plan as soon as possible. Otherwise, you run the risk of those shares dropping in value and leaving you with a tax hit and a capital loss that won't offset your taxable employment income.

As a minimum, sell enough shares to raise the cash to pay your taxes. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way.

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El IRPF amplía las posibilidades de deducción y rebaja la tributación de las acciones gratuitas

Para entenderlo, imaginemos que tenemos stock options con un precio de ejercicio de 30 euros, que nos permiten ejercer nuestro derecho de compra en un momento en el que la acción cotiza a 42 euros. Re: Venta "stock options" Ver mensaje de Bacalo El BBVA, me ha dado un papelito con las fechas y los importes de venta y compra. Según el enlace que me has facilitado, la cotización al cierre de la fecha de compra fue de 17,42 Euros. Jan 31,  · Topic Number - Stock Options. If you receive an option to buy stock as payment for your services, you may have income when you receive the option, when you exercise the option, or when you dispose of the option or stock received when you exercise the option.