If you had an employee share plan or arrangement in the 2021/22 tax year, now is the time to start thinking about your annual reporting obligations.
Share plan annual returns need to be filed online by 6 July 2022 in respect of all your share incentive arrangements to avoid penalties (an initial penalty of £100 will be due if a return is just one day late). As the online returns process can be tricky and time consuming to navigate, it is a good idea to prepare and file your returns as soon as possible.
Points to Note:
- You need to make a return in respect of all your share plans and arrangements (tax-advantaged and non tax-advantaged) whether or not they were set up with a formal set of plan rules.
- Don't wait for a reminder from HMRC – they won't send one!
- Before you can make an annual return, your share incentive arrangement or plan must be registered with HMRC under the ERS online service (part of the HMRC PAYE online service – if you don't already have access to this service, you can register for it here).
- To check whether an arrangement or plan is already registered, go to the "view" tab in your ERS online account (through your PAYE online portal) to see all the arrangements registered under your PAYE reference number (note that all your non tax-advantaged arrangements and plans can be registered under a single reference number).
- You must submit a return every year even if there has been no activity (for example, no new grants) during that period (in such circumstances you must file a "nil" return). You can download and complete the relevant annual return template online which can be located here.
- For more information about the process for registering your share plans click here. For information about submitting your returns click here.
- Sometimes the sale of shares or securities by your employees and directors and the cancellation or exchange of awards may also need reporting. Take advice if you aren't sure as HMRC can charge a penalty of up to £5,000 if a return contains a material inaccuracy.
Dealing with your returns can be complex and time-consuming. We can help take away the pain of the process by:
- Working with you through the whole annual return process;
- Reviewing your completed returns before you file them; and
- Answering your specific queries about completing and/or filing your returns.