Reporting shares, options and benefits in kind – act before 6 July

04 July 2022 - Chloe Wright

Every year employers are obliged to report items, services or shares and awards they have provided to employees. The information needs to be reported to HMRC by 6 July following the end of the tax year, or the employer may have to pay a penalty.

P11D

If a business gives items or services to its employees in addition to their salary, such as company cars, private healthcare or loans for season tickets, these benefits in kind must be declared to HMRC each year on a P11D form.

The P11D forms together with the declaration P11D(b) form for the year ended 5 April 2022 need to be submitted by 6 July 2022 in order to avoid HMRC penalties. Any Class 1A NIC due on the benefits in kind needs to be paid by 19 July 2022. Please click here for guidance relating to certain benefits in kind for your assistance.

Employment Related Securities and Options Return

Companies are also required to make a return to HMRC each tax year of certain transactions involving shares, securities and options known as Employment Related Securities (ERS). Typical ERS schemes and returns include:

  • Enterprise Management Incentive (EMI) plans
  • Company Share Option Plans (CSOP)
  • Save As You Earn (SAYE) plans
  • Share Incentive Plans (SIP)
  • All schemes which were previously filed on a Form 42 (‘unapproved’ or non-tax advantaged plans)
  • Overseas ERS plans which have UK participants.

If you think you have any reportable transactions, please contact us as soon as possible so that we can discuss completion of the return.

Please note that the return relating to transactions in the year to 5 April 2022 must be filed online with HMRC by 6 July 2022. Unfortunately, HMRC has restricted the access for agents (even where we operate the payroll on the Company’s behalf). This means that although we can administer the information once a scheme has been set up, HMRC requires that it is the employers themselves who register the scheme initially.

You will need to do this whether or not you want us to complete the returns for you. Please note that the registration process takes some time, so if you would like us to complete the returns online for you, we will need your assistance as soon as possible.

The issue or transfer of shares, securities or options to directors or employees can have significant tax implications for both the company and the director/employee, and we always recommend you discuss such transactions with your Scrutton Bland contact before you put them into place.

If we can help with completion of either the forms P11D or the ERS return, or if you have any queries on the issues raised, please do not hesitate to contact us by calling 0330 058 6559 or emailing our tax team on hello@scruttonbland.co.uk.

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