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4.16 Recognition of social charges (e.g., payroll taxes)
Publication date: 30 Nov 2022
us IFRS & US GAAP guide
The timing of recognition of social charges generally will be earlier under IFRS than US GAAP.
US GAAP | IFRS |
A liability for employee payroll taxes on employee stock-based compensation should be recognized on the date of the event triggering the measurement and payment of the tax (generally the exercise date for a nonqualified option or the vesting date for a restricted stock award). | Social charges, such as payroll taxes levied on the employer in connection with stock-based compensation plans, are expensed in the income statement when the related share-based compensation expense is recognized. The guidance in IFRS for cash-settled share-based payments would be followed in recognizing an expense for such charges. |
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