Employment and pensions

Employment related securities | Update from HMRC

Published on 15th Sep 2021

HMRC has published an update on employment related securities, response to consultation on the expansion of the EMI Scheme awaited


HMRC published its Employment Related Securities Bulletin (39) on 17 August 2021.

The latest edition covers some practical updates on the Employment Related Securities online service, including the annual returns process and how to cease a scheme no longer operating or registered in error.

ERS annual returns

HMRC notes that nearly a third of registered share schemes did not file their Employment Related Securities (ERS) return for the tax year 2020/21 by 6 July 2021, resulting in late filing penalties being issued.

It reminds companies operating employment related security arrangements that even if there have been no reportable events in the year a nil return must still be submitted. There is a continuing obligation to file returns every year until the scheme ceases and a final event date is entered.

Ceasing a scheme no longer operating or registered in error

To cease a scheme, the company must access HMRC's ERS online service through the company's PAYE for Employers account. Annual returns must have been filed for every year (even if the return was nil).

The Bulletin contains information on how to cease an ERS scheme, which employers should refer to where a share plan has ended.

Call for evidence on EMI options

The government issued a consultation earlier this year on whether the enterprise management incentive (EMI) scheme should be extended to include more companies.

The Bulletin does not provide an update on this. However this is not surprising, given that the Bulletin covers practical updates from HMRC rather than any policy changes.

We responded to the consultation, expressing our support for the expansion of the EMI regime to ensure that all small and medium-sized enterprises (SMEs) and high-growth companies qualify to grant EMI options and that the regime operates efficiently.

We expect that the government will provide an update or summary of responses around the time of the Budget on 27 October 2021.

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* This article is current as of the date of its publication and does not necessarily reflect the present state of the law or relevant regulation.

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