The tax information below is an extremely brief summary for standard situations of the referred relationship, and each situation may of course be different from the norm and have its own specificities.

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More comprehensive information for this country and its work relationships is available on Easop.

✅ Yes, you can grant non-qualified stock-options (NSO) to employees in Spain.

In a nutshell, what does taxation look like?

• At grant 👉 No taxation.
  
  
• At exercise 👉 The spread (i.e. the difference between the fair market value (FMV) of the shares at the time of exercise and the exercise price paid by the grantee) is taxed as salary income.
  
  
• At sale 👉 The sale price minus the fair market value of the shares at the time of exercise will be taxed as “savings” income.

Is there a tax-favored scheme?

There are certain tax advantages your grantees may be eligible to, i.e.

• 30% tax reduction  
  
  
• EUR 12k exemption‍

it’s worth checking out the conditions!

✅ Yes, you can grant non-qualified stock-options (NSO) to EoR employees in Spain.

In a nutshell, what does taxation look like?

• At grant 👉 No taxation.
  
  
• At exercise 👉 The spread (i.e. the difference between the fair market value (FMV) of the shares at the time of exercise and the exercise price paid by the grantee) is taxed as salary income.
  
  
• At sale 👉 The sale price minus the fair market value of the shares at the time of exercise will be taxed as “savings” income.

Is there a tax-favored scheme?

There’s a certain tax benefit available whereby 30% of the taxable gain at exercise can be tax exempt, but there a few conditions/restrictions attached to this tax benefit.

Independently from the 30% reduction, the fact that capital gains are less heavily taxed compared to professional income 👇

💡 A way to reduce taxation for the grantee would be to allow the grantee to “early exercise” the stock options (i.e. exercising stock options that have not vested yet) but early exercises are not always easy to manage from the company’s perspective and on the grantee's side it may increase the risks of paying an exercise price (and taxes thereon) on something which may happen to be eventually worth nothing later down the road.

✅ Yes, you can grant non-qualified stock-options (NSO) to contractors in Spain.

Note that granting stock options to contractors could increase the misclassification risk (i.e. the contractor relationship being requalified as an employer-employee relationship, with all tax consequences that can go with it). This will never be the only factor though, what counts primarily for determining the degree of misclassification risk are factors relating to the modalities of the services performed (control over the contractor’s work, exclusivity, term of the services, etc.).

In a nutshell, what does taxation look like?

• At grant 👉 No taxation.
  
  
• At exercise 👉 The spread (i.e. the difference between the fair market value (FMV) of the shares at the time of exercise and the exercise price paid by the grantee) will be taxed under the “general” tax base.
  
  
• At sale 👉 The sale price minus the fair market value of the shares at the time of exercise will be taxed as “savings” income.

Is there a tax-favored scheme?

There’s a certain tax benefit available whereby 30% of the taxable gain at exercise can be tax exempt, but there a few conditions/restrictions attached to this tax benefit.

Independently from the 30% reduction, the fact that capital gains are less heavily taxed compared to professional income 👇

💡 A way to reduce taxation for the grantee would be to allow the grantee to “early exercise” the stock options (i.e. exercising stock options that have not vested yet) but early exercises are not always easy to manage from the company’s perspective and on the grantee's side it may increase the risks of paying an exercise price (and taxes thereon) on something which may happen to be eventually worth nothing later down the road.