When do I actually owe tax on stock options — when they're granted, exercised, or when I sell the shares?

Generally, grant itself isn't a taxable event, receiving the option doesn't trigger tax on its own. For options from a company that isn't a CCPC, such as a public company, tax on the resulting employment benefit generally arises at exercise, when you actually acquire the shares, based on the difference between their value at that point and what you paid under the option. For a genuine CCPC, that same benefit is generally deferred until you actually sell or otherwise dispose of the shares, rather than being taxed at exercise.

Once the shares are eventually sold, any further increase in value beyond what's already been taxed as employment benefit income is treated separately, as a capital gain, taxed under the ordinary rules that apply to any other capital property. So depending on your company's status, you can end up with tax arising at up to two different points: once on the employment benefit, at exercise for non-CCPCs, or at sale for CCPCs, and again on any additional capital appreciation between that point and an eventual later sale.

Because these rules interact with your company's specific status and the timing of each step, tracking exactly when each event happens, and what your company was at each relevant date, matters for getting the tax treatment right.