In Ireland ESOP is the term commonly used to describe an all-employee share
participation plan which is made up of a combination of two Revenue approved share
schemes, viz, the Employee Share Ownership Trust (ESOT) and the Approved Profit
Sharing Scheme (APSS). Historically ESOPs are most prevalent where semi-state
bodies are being privatised or sold, although any company may choose to implement one.
The ESOT is a tax favoured vehicle which typically stockpiles shares for employee
participants for distribution over time. It does not itself afford participants direct access to
shares in a tax efficient manner. Tax relief is afforded to participants by way of share
appropriations via an APSS. The main features of an ESOT are outlined below. For more
information on the operation of an APSS please see the Guide to Approved Profit Sharing
Schemes.
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