A stock option grant to an Australian employee is the right to buy shares at a set strike price later, taxed under the ATO’s employee share scheme rules. On finance hires I place, the current value of the grant typically runs from roughly $100,000 to $200,000 at a first finance hire up to $600,000 or more for a senior CFO seat.
Not a trading product, an employment right
A retail investor searching “options Australia” is usually asking about trading calls and puts on the ASX or a US exchange through a broker. That is a different market entirely. On the roles I recruit for, a stock option is a right granted by an employer, under a formal plan, to buy company shares at a fixed strike price once the option vests. It is governed by the ATO’s ESS rules the same way any other equity grant is.
What a real grant looks like at each stage
The headline percentage on an offer means little without knowing the current strike price and the company’s last valuation. Here is the current value, at grant, of option packages I have actually seen land on Australian finance roles.
On the CFO roles at the top of that range, the LTI component is often the larger part of the package by design: a base salary topping out around $270k plus superannuation, with options worth $100k to $200k initially, structured to be the piece that pays off most if the business performs.[1] On one search I ran, options valued at $600k to $650k at grant were projected to be worth closer to $1 million by year end on the company’s own growth trajectory.[2]
I broke down how base salary moves by funding stage separately, alongside the equity component.
When the tax bill actually falls due
For a right such as an option, the deferred taxing point under a tax-deferred ESS scheme is the earliest of: no real risk of forfeiture and no restriction on disposal once exercised, or 15 years after the option was granted.[3] If the company qualifies for the start-up concession, the exercise price has to be at or above the market value of an ordinary share at the time of grant, and if that condition and the others are met, the taxable discount is reduced to nil. Exercising the option and eventually selling the resulting shares then falls under ordinary capital gains tax rules.
I go through the full ESS tax framework, upfront versus deferred versus the start-up concession, in more detail.
What to actually ask about before you value a grant
A candidate evaluating an option grant needs four numbers, not one percentage: the strike price, the current 409A-equivalent or most recent priced valuation, the vesting schedule, and whether the plan is structured for the ESS start-up concession. Without those, the headline number on the offer is close to meaningless.
I set out how to translate a grant into a range of dollar outcomes a candidate can actually weigh up.
Common questions
Are stock options in an Australian startup the same as trading options?
No. A startup stock option is the right to buy company shares at a fixed strike price later, granted as part of employment and taxed under the ATO's employee share scheme rules. Trading options on the ASX or a global exchange are an unrelated retail investment product.
How much are option grants typically worth on senior finance roles?
On the roles I place, the current value at grant runs from roughly $100,000 to $200,000 for a first finance hire, up to $600,000 or more for a senior CFO seat, sometimes projected to grow further against the business's own plan.
When do you pay tax on a stock option grant in Australia?
It depends on the plan. Under a tax-deferred scheme the taxing point is the earliest of no real risk of forfeiture, or 15 years from grant. If the company qualifies for the ESS start-up concession and the option's exercise price is at or above market value at grant, the taxable discount can be reduced to nil, with tax only arriving as CGT on eventual sale.
What should I ask about before valuing an option offer?
The strike price, the company's most recent priced valuation, the vesting schedule and cliff, and whether the plan is structured to qualify for the ESS start-up concession. A percentage on its own tells you almost nothing.
References
- From a search I ran: a senior finance role with a base topping out around $270k plus super, and an LTI of $100k to $200k in options designed to be the largest component of the package for a candidate invested in future growth.
- From a CFO search I ran: options valued at $600k to $650k at the time of the offer, projected to be closer to $1 million by year end based on the company's growth trajectory and valuation.
- The deferred taxing point rules for rights (including options) are set out on the ATO’s tax-deferred schemes page.
These guides set out how we see it, drawn from the searches we run and the finance leaders we place. They are general information about the market, not financial, accounting or legal advice, and they are no substitute for advice on your own circumstances.