In several posts last year, we charted the development of the new HMRC rules for the online registering, self-certifying and making of annual returns for share plans, and indeed all arrangements under which employees receive shares.
Now the dust has settled, the teething troubles have been ironed out and the templates for the new “end-of-year” returns have been finalised. The time for action has come – if you operated a share plan last tax year, everything must be done and dusted by 6 July 2015. If it isn’t, then depending on the plan/arrangements, fines can be imposed and/or tax advantages lost. Some of the stages require a week or so before the next stage can be started, so can’t be left until the last minute. If you’ve been putting this off, now is the time to grasp the nettle and get cracking!
What do you need to do?
All tax-advantaged share arrangements – company share option plans (CSOPs), savings-related share option schemes (SAYE or Sharesave), Enterprise Management Incentive (EMI) options and share incentive plans (SIPs) – must be:
- registered with HMRC Online Services. This applies whether the plan was approved by HMRC under the old prior approval procedure that operated before 6 April 2014 or is a new plan established since then. To register, you will need a PAYE reference number, but this can be the number for any company in the group. You will then receive login details, which can take up to 7 days, and a registration number unique to that plan. Details are set out in the “employment-related securities” section of HMRC’s FAQs;
- self-certified. This means the company declaring that the relevant plan complies (and has complied at all times since the first grant/award under it) with all the legislation applicable to that type of plan. Self-certification is included as part of the registration process; and
- included in an online end-of-year return by 6 July every year, in which you have to give specified details for each “reportable event”, such as the exercise, surrender, release, roll-over or lapse of an option. You need to make a return for each registered plan every year, even if nothing has happened under that plan during the previous tax year (that is, a nil return). You’ll need to use the unique number of the plan you were given on registration. There is a different template spreadsheet for each type of plan.
Non-tax-advantaged plans and share arrangements (the ones that were previously called “unapproved” and reported on HMRC form 42) operated in the 2014/2015 tax year also need to be registered online with HMRC, although self-certification doesn’t apply. If you like, you can choose to register all these kinds of plans/arrangements under one reference number. Alternatively, you might find it administratively easier to have one reference number for each plan or arrangement of this type. Again, all reportable events need to be included on an online end-of-year return by 6 July after the end of the tax year in which they occur.
Things to remember
- if you want confirmation that you have successfully registered your plan, you need to print and/or save a copy of the final screen after you press “submit”, as this is the only acknowledgement you’ll get;
- end-of-year returns can be done by an agent (we are registered as agents for this purpose), but registration and self-certification of plans can’t – they must be done by an officer of the company; and
- make sure that you get the details of the plan right before pressing the submit button, because it’s a pain if you don’t – see our previous blog post on this topic.