If a company acquires a company with a UK presence that registered its equity programs with Her Majesty's Revenue & Customs (HMRC), it will be necessary to add the PAYE information of the acquired UK entity to the acquiror's UK entity's existing registration and report any assumed grants held, or new grants made, to employees of the acquired UK entity.
Furthermore, it is necessary to de-register the share plan registration of the acquired UK entity with HMRC. An annual return must also be submitted by the acquired UK entity for the tax year in which the date of last event (as reported to HMRC) occurs. This should include any reportable events that occurred up to closing that are not reported on the acquiror's UK entity's return.
Failure to file such a return will result in the assessment of automatic penalties by HMRC. We recommend a de-registration be completed as quickly as possible after closing. The company should also ensure that the login details of the acquired UK entity are secured as part of the transaction.