Social insurance contributions are generally payable by the employee and employer.

A Medicare levy is payable by the employee on that part of restricted stock and RSUs that are taxable income. An additional Medicare levy surcharge may also be imposed on higher income employees without appropriate health insurance.

Social insurance contributions are payable on restricted stock and RSUs, subject to a cap. Withholding is required.

Traditionally, restricted stock and RSUs were not subject to social insurance contributions, provided at least they were not granted by the employer of the beneficiary. Social security contributions are indeed only due on benefits "granted by the employer in the framework of the employment contract." The notion of "granting" was in this regard construed in a broad sense, and it covered: (a) the situations where the employer directly pays the benefit, (b) the situation where the employer indirectly pays the benefit because the parent company granting it charges the cost for doing so to the employer, and (c) the situation where the employer does not bear the financial cost of the benefit, but intervenes in the granting of the benefit. Notably in its judgment of October 10, 2016, the Belgian Supreme Court decided that social security contributions are due if all costs of the benefit are paid by a 3rd party, but the employer decides which person receives the benefit in question.

While the legislation was not changed, the National Office for Social Security started taking the view that the question of who bears the financial burden of a benefit is not decisive, in the sense that social security contributions are definitively due if the financial burden is on the employer, but social security contributions can still be due if the financial burden is on the parent company of the employer. The National Office for Social Security did not publish a clear test to be used in order to determine when social security contributions are due, but seems to take the position that social security contributions are due, unless it can be established that a benefit is granted outside the framework of the employment contract –for instance, in the framework of a shareholder agreement.

In a judgement of September 5, 2022, the Supreme Court rejected the position by the National Office for Social Security, although without clearly adding the correct test in order to determine whether or not social security contributions are due. The Supreme Court referred the case to the Employment Appeal Tribunal of Antwerp, which did, in a judgement of November 20, 2023, apply the traditional interpretation according to which a benefit granted by the parent company is not subject to social security contributions if (1) the employer does not at all intervene in the administration of the plan, and moreover (2) all costs in relation to the plan are borne by the parent company. It remains nevertheless to be seen whether the National Office for Social Security will again lodge an appeal before the Supreme Court against this judgement of the Antwerp Employment Appeal Tribunal.

Restricted stock and RSUs may be subject to social insurance contributions since it could be deemed employment income subject to such contributions.

Generally, social insurance contributions, which are based on an employee's compensation and are subject to a cap, are payable on restricted stock and RSUs.

Compensation derived from restricted stock units and RSU plans is subject to social security contributions if, together with the remaining remunerations payable to the eligible employee in the same month period, do not exceed the capped compensation that the law states as a basis for social security calculations. For instance, if the base salary of an eligible employee suffices the capped basis, compensation from the plans paid in the same period will not be subject to social security contributions as they are over the capped basis. Otherwise, if compensation of the plan, together with the remaining remunerations payable in the month, is lower than the capped month basis, they shall trigger social security contribution payments. In addition, should the benefits be paid directly by the issuing company with no charge-back to the local employer, it is debatable whether they will trigger social security contributions obligations.

Social insurance contributions may be imposed on restricted stock and RSUs.

If the stock is granted as a non-salary payment, it would not be included in the basis to calculate social security contributions, provided that such payments do not exceed 40 percent of the employees' total monthly compensation.  If these non-salary payments exceed 40 percent of the total monthly compensation, the excess will be subject to social security contributions.

The basis to calculate contributions to the social security system (pensions, solidarity pension fund, health and labor risks) is the monthly salary earned by the employee. If that monthly salary exceeds 25 times the minimum legal wage, contributions to the social security system will be calculated on the maximum basis of 25 times the minimum legal wage.

If an employee earns a so-called "integral salary," 70 percent of the employee's salary will be the basis to calculate contributions to the social security system.  However, if 70 percent of the integral salary is more than 25 times the minimum wage, contributions to the social security system will be calculated on the maximum basis of 25 times the minimum wage.

Social security and health insurance contributions do not apply provided that:

• The Czech employer is not responsible for the costs of the plan (ie, there is no reimbursement of costs)

• Shares of the Czech employer are not included in the plan and

• Payments are not made through the Czech employer.

Restricted stock and RSUs are subject to Danish labor market contribution when taxed as salary income. Spread taxed as capital gains is not subjected to labor market contribution.

Restricted stock and RSUs may be subject to social insurance contributions.

Restricted stock and RSUs are not subject to social insurance obligations.

Restricted stock and RSUs may be subject to certain social insurance contributions.

Employee

For Restricted Stock and RSUs granted pursuant to a plan authorized as of 01/01/2018

An acquisition gain below EUR300,000 is subject to social contributions (ie, CSG-CRDS) at a global rate of 17.2 percent, including a 3.4 percent deductible from taxable income.

An acquisition gain above EUR300,000 is subject to social contributions at a global rate of 9.7 percent, including 6.8 percent deductible from taxable income.  It is also subject to an employee social contribution at a rate of 10 percent.

Capital gain is subject to social contributions at a global rate of 17.2 percent.

Employer

For Restricted Stock and RSUs granted pursuant to a plan authorized as of 01/01/2018

The employer will be subject to a contribution to the social security scheme (contribution sociale patronale) of 20 percent which is payable within a month following the acquisition date of the shares.

Small and medium enterprises (SMEs) may be exempt from the payment of the employer's contribution.

For Restricted Stock and RSUs granted pursuant to a plan authorized as of 01/01/2021

Mid-cap companies may be exempt from the payment of the employer’s contribution only if no dividend distribution has been made since its incorporation.

Tax and social regime applicable to non-qualifying plans

The gains realized upon the vesting of RSUs granted pursuant to non-qualifying plans are treated as salary for tax and social purposes.

As such, vesting gains are subject to the progressive scale of income tax (with a maximum rate of 45 percent) and to a special 3- to 4-percent surtax on high income. As from 2019, income tax on non-qualifying plans is withheld by employers, who are also in charge of withholding income tax on salaries.

From a social standpoint, employer social security charges are due at a maximum rate of approximately 45 percent and employee social security charges are due at a maximum rate of approximately 25 percent, including 22.1 percent deductible for income tax purposes.  Both employer and employee social charges are withheld by the employing entity.

Restricted stock and RSUs are subject to social insurance obligations, up to a cap.

Typically, according to the existing social security legislation, restricted stock and RSUs are subject to social insurance at vesting.

Not applicable for this jurisdiction.

Generally, the employee must pay social insurance/health tax on the taxable amount.

Social insurance generally is not applicable to restricted stock and RSU benefits.

Unless the parent company is reimbursed by the subsidiary for restricted stock and RSU benefits that are routinely granted, such benefits generally are not subject to social insurance contributions.

Restricted stock and RSUs are subject to employee’s PRSI. Employer’s PRSI should not apply unless the award is cash-settled.

Portions of the taxable amount are subject to social insurance contributions, depending on whether the income is classified as ordinary income or capital gains.

Restricted stock and RSUs are generally not subject to social insurance, provided that the equity incentive plan provides the grant of restricted stock and RSUs under predetermined conditions. However, a case-by-case analysis is recommended.

Restricted stock and RSUs are not subject to social insurance contributions as long as the awards are not considered part of the employee's salary.

There is no social insurance scheme per se for Malaysia but there is a mandatory requirement for contributions to the Employees' Provident Fund (EPF) and Social Security Organization (SOCSO) for all employees who are Malaysian citizens and permanent residents of Malaysia. The requirement to contribute is based on a percentage of wages. So far as the plan is carved out and not made a term of the employment contract and does not form part of wages, there is no requirement to contribute to EPF or SOCSO based on the employee's entitlement to the stocks.

Restricted stock and RSUs are likely subject to social insurance contributions if the Mexican subsidiary reimburses the parent company for the cost of the award benefits.

Social insurance contributions are imposed on restricted stock and RSU benefits to the extent that the employee's annual employment income has not yet exceeded the maximum income base for social security premiums.

New Zealand does not operate a general social insurance regime.

Social insurance contributions are generally payable by the employer and the employee. However, there are no specific requirements for social insurance contributions in relation to employee share and stock options.

Restricted stock and RSUs are subject to social insurance contributions.

Unless the parent company is reimbursed by the Philippine subsidiary for restricted stock or RSU benefits, such benefits generally are not subject to social insurance contributions.

Unless the subsidiary is involved in the offer of restricted stock or RSUs, or reimburses the parent company, the benefits from the awards are generally not subject to social insurance contributions.

Employers and employees make monthly social security contributions based on monthly earnings – as a rule, 23.75 percent of the relevant retribution for the employer and 11 percent for the employee.  Ownership of securities is not taken into consideration to calculate said contribution, unless it is considered part of the employee’s remuneration.

Unless the offer of restricted stock and RSUs is deemed to be an employment benefit, they generally are not subject to social insurance contributions.

Generally, the benefit is unlikely to be subject to social insurance contributions.

Restricted stock and RSUs generally are not subject to social insurance contributions.

Restricted stock and RSU benefits subject to tax are generally subject to social insurance contributions and health insurance contributions by both the employee and employer.

Restricted stock and RSUs generally are subject to social insurance contributions.

Restricted stock and RSUs are generally subject to social insurance contributions upon vesting.

Restricted stock and RSUs are subject to social insurance contributions, subject to the general ceiling exemptions.

Restricted stock and RSUs are subject to social insurance contributions.

Restricted stock and RSUs are subject to social insurance.

If the taxable income of any employee upon each grant (in case of restricted stock) or vesting (in case of RSUs) exceeds TWD20,000 (approximately USD700), the entire income is subject to Taiwan social insurance contributions at 2.11 percent.

Restricted stock and RSUs are generally not subject to social insurance contributions.

Restricted stock and RSUs are subject to social insurance contributions.

Restricted stock and RSUs are not subject to social insurance obligations, nor are dividends and proceeds from the sale of shares.

Restricted stock and RSUs are subject to National Insurance Contributions (NICs) if shares are "readily convertible assets."

In the case of RSUs, through an approved Joint Election or other contractual arrangement, the employer's NICs obligation may be transferred from the employer to the employee.

Restricted stock and RSUs are not subject to social insurance.

Restricted stock and RSUs generally are not subject to social insurance contributions.