HMRC have issued information on employment related securities as part of the July 2024 employer bulletin.
Employment Related Securities (ERS)
Gifts and awards of shares in employer companies, often known as employment related securities (ERS), are commonly used by employers to reward, retain, or provide incentives to employees.
Where an employer operates an ERS scheme they should have filed an end of year ERS return, including nil returns on or before 6th July 2024 for the 2023 to 2024 tax year. They should have done this for every scheme that is registered on the ERS online service against their your PAYE scheme.
If they missed the deadline, a £100 late filing penalty will be issued to the address of the associated PAYE account.
Additional automatic penalties of £300 are charged if they have not submitted the return three months after the original deadline of 6th July 2024. A further £300 will be charged if it is still outstanding six months after this date.
The charge description for penalties relating to employee share schemes will refer to employment related securities.
If the employer appeals against an ERS late filing penalty, an end of year return must still be submitted to prevent further penalties.
To submit an end of year return they must have already registered the scheme on the ERS online service. To register, they will need an employer PAYE reference number.
If a scheme has been registered in error, or is no longer operating, the scheme must be ceased online. This cannot be done by an agent, only the employer can cease the scheme online.
An ERS scheme needs to be linked to a live employer PAYE scheme. If you are closing your PAYE scheme, you may also need to cease the ERS scheme.
Once a scheme is ceased, an annual return must still be submitted for the tax year in which the final event date falls.
PAYadvice.UK 16/7/2024