What option types am I able to issue as a non-US company?

Review the list of international option plan terminology below, and consult your legal team for guidance on determining the appropriate structure for your company's option plan.

Term	Description
Incentive stock options (ISOs)	Used for US employees of US-incorporated companies A type of stock option that’s typically taxed only when you sell your shares. With ISOs, you’re likely off the hook for taxes when you exercise, but you’ll still need to pay taxes when you sell the resulting shares. However, this isn't always the case so be sure to consult a tax advisor before you exercise your options.
Non-qualifying stock options (NSOs)	Used for US-incorporated companies Another type of stock option. If you have NSOs, you’ll typically pay taxes both when you exercise and when you sell the resulting shares. If your equity grant says you have NSOs, Carta recommends consulting a tax advisor before you exercise your options.
International (INTL)	Typically used for companies in Singapore, Australia, Indonesia, Malaysia, the Philippines, etc. This equity type is Carta terminology used when there is no predetermined country-specific regulation for classification of stock options. For countries that do not have a specific classification of stock options or differentiated tax treatments for equity awards, INTL is used to designate the stock options.
Stock options	A type of equity compensation that gives you the option to buy shares at the “strike price” listed on your equity grant. Early-stage companies tend to give stock options. Stock options aren’t stock. That’s a big misconception. You still need to buy or “exercise” your options at the agreed-upon price in order to become an owner.
Restricted stock units (RSUs)	This is a type of equity grant where you own shares automatically if certain conditions (such as a vesting cliff) are met. RSUs are more likely to be issued by mature companies. You don’t need to plan to exercise your RSUs; they’re yours outright once they vest. But, when they do vest, you’ll need to pay taxes.
Restricted stock awards (RSAs)	A Restricted Stock Award is a grant of company stock in which the recipient's rights to the stock are restricted until the shares vest (or lapse in restrictions). The restricted period is called a vesting period. Vesting periods can be determined by the passage of time, or by company or individual performance. RSAs provide the individual the right to purchase shares at FMV, at a discount, or at no cost on the grant date.
Stock Appreciation Rights (SARs)	Stock appreciation rights (SARs) are a type of employee compensation linked to the company's stock price during a set period of time. Employees profit from any increase in the company’s stock price over the price set in the award during that period. Unlike stock options, there is no exercise price required to exercise SARs. Depending on the rules of the plan, the employee will simply receive the net amount of the increase in stock price value in the form of cash or shares of company stock.
Section 102	Used for Israel-incorporated companies Section 102 of the Israel Tax Ordinance lays out three different options—or "tracks"—for how and when equity-based compensation awards to employees and company officers are taxed.
Capital Gains Track	Used for Israel-incorporated companies This track requires that the company nominate a trustee to hold grants for two years, after which the grant’s income is taxed at capital gain rates (for private companies) or a combination of capital gain and regular income tax rate (publicly-traded companies). As long as the grant remains with the trustee for the entirety of the holding period, it is taxed only when shares are sold.
Ordinary Income Track Trustee or Non-Trustee	Used for Israel-incorporated companies This track taxes income from the grant as ordinary income when the shares are sold. Companies can choose this track with or without appointing a trustee, but if the shares are not held by a trustee, the company must guarantee sufficient funds to cover taxes when the shares are sold.
3(i)	Used for Israel-incorporated companies Grants to anyone not eligible to receive grants under Section 102 (typically non-employees) will fall under Section 3(i) of the Israel Tax Ordinance. Section 3(i) grants are taxed as ordinary income when the shares are issued or options are exercised, and as capital gains when the shares are sold.
Company Share Option Plan (CSOP)	Used for UK-incorporated companies The CSOP is a discretionary tax-advantaged option plan that allows a company to grant options at market value to any employee or full-time director. Gains realized by grant recipients are typically exempt from income tax and national insurance if certain conditions are met.
Enterprise Management Incentives (EMIs)	Used for UK-incorporated companies A tax-advantaged employee option plan scheme for companies with 250 or fewer employees. No income tax or national insurance is payable when EMI options are granted at market value and other qualifying conditions are met.

Select an option below for more information about onboarding to Carta as a non-US company.