Share Schemes are Moving Online!

http://www.rm2.co.uk/resources/blogs-news/budget-2014-share-scheme-perspective/

HM Revenue & Customs (HMRC) is changing the way that share schemes are administered and reported. The alterations will affect both new and existing share schemes. So, if you are a company with a share scheme, or are considering implementing one, you need to be aware of the new requirements.

HMRC have recently issued letters to all companies currently operating a share scheme informing them of the new online service, the Employment Related Securities (ERS) service, launching this April 2014.

Companies already using HMRC online services can access ERS through the HMRC online services PAYE area. Those without this option will be required to complete a registration process. It will then be possible to authorise a third party administrator to act as an agent, allowing the continued administration of a scheme.

What information will you need to register online?

From 6th April 2014, all share schemes must be registered with HMRC online. This includes 'unapproved' plans and those which pre-approval could formerly be sought for. Companies that have established an Enterprise Management Incentive (EMI), Share Incentive Plan (SIP), Company Share Option Plan (CSOP) and Save-As-You-Earn (SAYE) Scheme will need to self-certify that the schemes meet the legislative requirements by submitting an online declaration.

Failure to register arrangements online will result in any tax advantages being lost.

From 6th April 2014, the notification of EMI options will be made online. This will replace the requirement to file EMI1 paper forms for each participant (known as Notices of Grant forms). This includes options that were granted prior to 6th April, but have not been registered by this date.

Remember that all EMI options must be filed within 92 days of the date of grant.

For example, If an option was granted on 28th January 2014, you would have until 30th April 2014 to notify HMRC of the award. If the notification occurs after 6th April, you would need to complete the registration and self-certify first.

From April 2015, Annual returns EMI40, SIP39, CSOP35 and SAYE34 must be filed online - and HMRC will issue automatic penalties if the July 2015 submission deadline is not met.