My company is offering a salary sacrifice share plan where we can purchase up to $5k pa in the companies shares with our pre-tax earning. The caveat is that I can only sell the shares after holding them for two years of ceasing my employment at the company.
Seems like a good deal which I signed up for. I later read in the fine print that this is considered "tax deferral" and it says you would pay tax at the time the shares are released (I assume this is after the two years passes).
My questions are:
* Would the purchase price of the shares be added to my gross income in two years time when the shares are released to me?
* If I move up at work in that time into a higher tax bracket, wouldn't I prefer to get hit with the tax now rather than in two years?
Thanks in advance. :)