An employee stock ownership plan (ESOP) is an employee-owner program that provides a company's workforce with an ownership interest in the company. ; Under these plans, the employer gives certain stocks of the company to the employee for lesser costs which remain in the ESOP trust fund.; These plans are aimed at improving the performance of the company and help in minimizing problems related to incentives.;
An employee stock ownership plan (ESOP) is an employee-owner program that provides a company's workforce with an ownership interest in the company.
Under these plans, the employer gives certain stocks of the company to the employee for lesser costs which remain in the ESOP trust fund.
These plans are aimed at improving the performance of the company and help in minimizing problems related to incentives.
Vesting period: The time limit for availing this scheme. For instance, one can acquire the shares after one completes a particular period of employment.
The ESOP is not taxed on acquiring the shares. Employees are taxed on the profit they make when they sell the shares or transfer them.