Tech startups have long been a gambling game that would make the Ontario Lottery and Gaming Commission proud. They often underpay their staff and make up the difference in stock options etc., hoping that the company will gain enough momentum that they can cash out before potential investors realize they’re a long way from turning a profit. You have to be either young and foolhardy or crazy ambitious to hitch your wagon to that kind of star.
Will this tax change discourage those types of companies a bit? Maybe, but since most of them fail anyway, I don’t think much of value is going to be lost.
(I was young and foolhardy once upon a time, but I’m actually not all that salty about it—they paid me a reasonable salary and I wasn’t expecting the rest of what they promised to actually materialize. However, I had the advantage of not having picked up any student loan debt, which was rare even then.)
This doesn’t even affect most workers who get RSUs. Only people whose shares might grow by more than 250K in one year. Not whose shares are worth over 250K.
Tech startups have long been a gambling game that would make the Ontario Lottery and Gaming Commission proud. They often underpay their staff and make up the difference in stock options etc., hoping that the company will gain enough momentum that they can cash out before potential investors realize they’re a long way from turning a profit. You have to be either young and foolhardy or crazy ambitious to hitch your wagon to that kind of star.
Will this tax change discourage those types of companies a bit? Maybe, but since most of them fail anyway, I don’t think much of value is going to be lost.
(I was young and foolhardy once upon a time, but I’m actually not all that salty about it—they paid me a reasonable salary and I wasn’t expecting the rest of what they promised to actually materialize. However, I had the advantage of not having picked up any student loan debt, which was rare even then.)
This doesn’t even affect most workers who get RSUs. Only people whose shares might grow by more than 250K in one year. Not whose shares are worth over 250K.