⚠️ 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. ⚠️
A more comprehensive set of information for this country and work relationship is available on Easop.
If you’re looking for more detailed information in this country (or if you are just curious about our global compliance offering and pricing), get in touch with us and we’ll tell you more about it! 💡
Employee via EoR
✅ You can grant non-qualified stock options (NSO) to local residents working as contractors in Lebanon.
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.).
There is no specific law or guidance on stock options in Lebanon and it’s not common to offer stock options to contractors.
In a nutshell, what does taxation look like?
It’s likely that taxation should take place at the time of exercise, and that no tax would apply at the time of sale of the shares.
This could change since Lebanon is in the midst of a financial crisis, and the government could for instance try to tax gains made upon sale of foreign assets (such as shares) at some point.
Is there a tax-favored scheme and how can you make sure the grantee can benefit from it?
The fact that gains made upon sale of the shares are currently tax-exempt in Lebanon can somehow be seen as an advantage compared to a cash bonus.