What happens to the tax treatment of my stock options if my private company goes public later?

If your company's stock options were benefiting from CCPC-style deferred taxation and the company later goes public before you've exercised or disposed of your shares, that favourable deferral generally stops applying going forward once the company is no longer a genuine CCPC. The standard timing rules that apply to public company options, generally taxing the benefit at exercise rather than waiting until an eventual sale, take over from that point, which can mean tax becomes owing sooner than you originally expected when the options were still governed by CCPC treatment.

This is a real practical trap for employees at companies moving toward an IPO or a similar transition, since the change in status can accelerate when tax is actually due on options that were granted, and perhaps even partly vested, back when the company was still private. Someone who assumed they had until an eventual share sale to deal with the tax consequences may suddenly find that exercise itself is now the relevant taxable event.

Because a pending IPO or change in corporate status can meaningfully change your personal tax timeline on existing options, anyone holding options in a private company that's moving toward going public should get advice on the specific timing consequences well before the transition happens, not after.