Acquisition cost of securities received from employers or legal persons at the preferential price or free of charge

When an employee has acquired securities from his or her employer free of charge or at the preferential price, and the employer has paid fringe benefits, income and social tax on these securities, or a natural person has acquired from a legal person a security as a gift, where income tax is charged by a legal person, then upon transfer of such securities also a sum of securities on which income tax was charged  by the employer or legal person shall be added to the acquisition cost. In such case you should contact the employer or a legal person who gave you securities and ask them to issue for you a certificate in free form, where the name of the issuer of securities and the registration code, type of the securities, quantity and value, and the sum on which income tax was charged by the legal person are entered.

As the amount referred to may be taken into account only in the case when the legal person has charged tax on the market price of securities received free of charge or at the preferential price, it is also necessary that on the certificate it could be seen when and in which annex (Annex 4 or Annex 5) of the form TSD the amount referred to was reflected.

Question: How is the acquisition cost formed on the securities that a person has acquired from an Estonian employer under an option contract?

Answer: The expenses incurred to a taxpayer by acquisition of underlying assets of an option, or the value of an option charged by an employer as fringe benefits on the basis of a certificate issued by an employer may be regarded as the acquisition cost.
 

 

02.06.2016