The government has released further details on its plans to simplify employee share schemes.
In December 2012, following recommendations made by the Office of Tax Simplification (OTS), the government announced that it would introduce self-certification of share incentive plans (Sips), save as you earn (also known as sharesave) schemes and company share option plans (Csops), as well as online filing for all share scheme forms.
Self-certification will apply from April 2014.
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The system is being introduced as part of a move to introduce a complete online system for registration of plans and submission of annual returns.
How the new self-certification and registration system will work:
- Employers must register all new and existing share plans, whether they are tax-approved or unapproved. They will need to provide details such as corporation tax reference, company registration number and plan type. The registration will be through the existing pay-as-you-earn (PAYE) online service.
- Employers will also need to certify that Sip, sharesave and/or Csop plans meet the tax-approval requirements. For existing plans this means stating that the plans have previously been approved by HM Revenue and Customs (HMRC). There are no details yet on what conditions will need to be met for self-certification of new plans. Self-certification must take place by 6 July 2014, after the end of the tax year in which first grants are made under a new plan.
- Where a organisation changes some features of tax-approved plans, these will not require pre-approval by HMRC. Instead, employers must report the changes in the relevant annual returns and confirm that certain conditions are met in relation to the changes.
- Annual returns still need to be submitted by 6 July following the end of the tax year and ‘intelligent forms’ will be downloadable so employers can complete them during the tax year in real time.
The first returns to be submitted online will be for the year ending 5 April 2015, so first filing will be due by 6 July 2015.