The Latest News on Expat Driving Licenses, Electronic Employees Authentication and Employee Stock Option Plan
Kuwait government attempts to clarify rules on expat driving licenses
Expats who’ve spent two years in Kuwait and have a monthly salary of over KD600 can easily get a driving license
Kuwaiti driving authorities now issued a clarification of who can and who can’t legally drive in the emirate. The rules set out apply to expats in general and also to Bedouin and non-Kuwaiti husbands of Kuwaiti women. The initial rule seems straightforward at first, as expats who’ve spent two years in Kuwait and have a monthly salary of over KD600 plus a university degree can easily get a driving license.
This rule can cause some difficulties for newly-arrived expats simply wanting to self-drive to and from work. That is why there are exceptions to it.
Expat women married to Kuwaitis and with children, as well as Bedouin nationals with security cards, students at Kuwaiti universities, diplomats, professionals in government sectors, sports federations or clubs are exceptions to the first rule, although expats may have to provide valid home country licenses.
Ministerial Resolution obligating all companies to authenticate their employees contracts electronically in Saudi Arabia
Employers must ensure that their employment contracts comply with MLSD regulations
The Ministry of Labor and Social Development (MLSD) in Saudi Arabia has implemented a law requiring private sector employers to upload their Employee’s employment contracts to the General Organization for Social Insurance (GOSI) electronic portal.
Employers must ensure that their employment contracts comply with MLSD regulations and must register the contracts on the GOSI portal by the relevant deadlines that mentioned in the attached Ministerial Resolution.
Once the Employers upload the employee’s contract, a text message will be sent to the employee registered number in GOSI. The employee shall review all the details of his contract signed with the company electronically to the accept / reject the contract. If the employee does not accept or reject the contract for more than 7 days, The contract will be authenticated automatically by the system.
Finland Tax authorities issue guidance on employee stock option and stock purchase plans
On 5 August 2019, the tax authorities issued updated guidance on the tax treatment of employee stock option plans and stock purchase plans.
Employee stock option plans
The guidance elaborates on different types of option stock option plans, such as stock awards, restricted stocks and share appreciation rights, and expounds upon:
- the taxation of an employee’s stock options;
- social security contributions payable by the employee and the employer;
- withholding obligations imposed on the employer when the option is exercised;
- how the employer must report the options in the income register;
- how the employee must include the options in his tax return.
Stock purchase plans
Such plans give employees the right to purchase shares at a price below the market value of the shares. This benefit is taxed as earned income to the extent that the purchase price is more than 10% below the market value, provided that the stock purchase plan is granted to the majority of the employees. If the right is not available to the majority of employees, the full amount of the benefit is taxable.
The tax authorities take the view that the majority means more than 50% of the staff either at the group level or within a single legal entity. The majority requirement is fulfilled if the stock purchase plan is granted by, for example, a foreign parent company to the staff of its Finnish subsidiary or by a Finnish parent company to the staff of the parent company.
The guidance also expounds on:
- the taxation of an employee’s stock purchase plan;
- the social security contributions payable by the employee and the employer;
- the withholding obligations imposed on the employer;
- the circumstances under which the employer must report the stock purchase plan in the income register;
- how the employee must include the stock purchase plan in his tax return unless it already is included in the pre-filled tax return.
Cross-border aspects of employee stock option and stock purchase plans
On 7 August 2019, the tax authorities issued updated guidance on the tax treatment of cross-border aspects of employee stock option and stock purchase plans.
The guidance addresses option plans and share purchase plans from the viewpoint of:
- a resident taxpayer subject to unlimited tax liability in Finland;
- a non-resident taxpayer subject to limited tax liability in Finland.
The guidance also explains:
- situations covered by an applicable tax treaty;
- relief provided to eliminate double taxation;
- the tax treatment of benefits granted to employees under the Finnish inward expatriate regime;
- reporting and withholding obligations imposed on the employer;
- social security contributions payable by the employee and the employer.
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