Employee Share Schemes: You may have reporting obligations by 6 July 2023

Employment Related Securities (ERS) return reminder

An ERS return is required each tax year to record share issues or share option movements during the year to employees/directors or their family members.

If you operate an employee share scheme or have awarded shares to employees in the tax year to 5 April 2023, you will need to register your scheme online, and file an annual return in relation to the scheme with HMRC by 6 July 2023.

It is likely that you will have reporting obligations if any of the below apply to your business for the tax year:

  • Issued shares to employees/directors or the employees/directors family members
  • Granted share options to employees/directors or the employees/directors family members
  • Have an existing scheme or set up a new ERS scheme in the period
  • One-off transactions such as a director or employee acquiring shares by reason of their employment

In summary, companies with any type of employee or director share plan or incentive scheme are likely to be required to register plans and submit annual returns online. This includes Enterprise Management Incentive (EMI) schemes, non-tax advantaged schemes or awards, a Company Share Option Plan (CSOP), Save As You Earn Scheme (SAYE) or Share Incentive Plan (SIP).

No transactions
It is important to remember that you must file an annual return for any schemes registered on HMRC’s online service even if there have been no reportable transactions in the year. A nil return is required until a plan is formally closed on the HMRC system.

Avoid filing penalties
There are penalties for late filing and also for incorrect returns. It is therefore important that due care is given to the information to be reported.

Further information and guidance on submitting an ERS return can be found here.