HM Revenue and Customs (HMRC) is to change the way both new and existing employee share schemes are administered.
In its Finance Bill 2014 new guidance notes, published on 7 February, HMRC detailed its new self-certification and online filing process, which follows recommendations made by the Office of Tax Simplification in March 2013.
The changes will impact:
- Sharesave schemes.
- Share incentive plans (Sips).
- Company share option plans (Csops).
- Enterprise management incentives (EMI).
- Any non tax-advantaged arrangements.
From 6 April 2014, employers will be required to register online any new plans, both tax advantaged and non-tax advantaged, and self-certify that any tax-advantaged plans are compliant with the legislation.
Employers must also register and self-certify all existing plans by 7 July 2015, whether they will make any awards under an existing plan in the tax year 2014-15 or not.
The new process will be part of HMRC’s Pay-As-You-Earn (PAYE) Online for employers’ service.
Anne Croft, employee share plan and employment tax lawyer at Tapestry, said: “The aim of these reforms is to simplify the process for employers when creating new share plans or amending existing ones, to speed up the grant process and to simplify annual reporting in relation to those plans.
“The rules do, however, require new registrations to be made and they do set new deadlines and new penalties.”