UK Employee Incentives Update | May 2025
Published on 2nd May 2025
Employment-related securities reporting obligations and recent employee tax developments
In this edition, we cover the important 6 July reporting deadline for companies operating employment-related securities arrangements, mandatory payrolling of benefits in kind delayed until April 2027 and our upcoming webinar on employee ownership trusts.
Employment-related securities | Reporting obligations and appointing additional administrators
The deadline for submitting employment-related securities annual returns and enterprise management incentive (EMI) notifications to HMRC for the tax year ending 5 April 2025 is by 6 July 2025. As the deadline falls on a Sunday this year, in practical terms most companies will be looking to file by Friday 4 July.
UK government's spring 2025 tax update | Mandatory payrolling of benefits in kind delayed and NICs election simplifications
The government announced a package of policy proposals on 28 April to support its ambitions to simplify and modernise the UK tax system. These include a delay to the introduction of mandatory payrolling of benefits in kind (which is to be introduced from April 2027 instead of April 2026) and simplification of the process for making joint National Insurance contributions elections.
UK Spring Statement 2025 | What are the tax implications for employees selling shares on PISCES?
Trading on the new Private Intermittent Securities and Capital Exchange System (PISCES) is expected to begin later this year. PISCES is a new type of stock market that will facilitate secondary trading of private company shares on an intermittent basis.
As part of the government's Spring Statement, HMRC published a technical note on the tax implications for companies and employees when a company has shares traded on PISCES.
Employee ownership trusts | Upcoming webinar
Please join us at our webinar "Unlocking your company's value through EOTs" on Tuesday 3 June at 10am. Our partners Michael Carter and Simon Smith will be sharing their experiences in assisting companies to become employee ownership trust (EOT)-owned, as well as the sale of EOT-controlled companies.
We will also be covering EOT developments including the recent legislative changes and updates to HMRC's guidance, following the reforms announced at Autumn Budget 2024.
UK Spring Statement 2025 | What business tax measures were announced?
The government confirmed in its Spring Statement that it would be holding a series of roundtables with stakeholders during April 2025, focusing on how policy supports the government's growth mission. This will include looking at the role of tax reliefs such as EMI.
Further support for tax-advantaged plans such as EMI is to be welcomed, and it will be interesting to see the outcome of this. An update will perhaps be provided around the time of the Autumn Budget.
Employee tax | Increase in official rate of interest
From 6 April 2025, HMRC's official rate of interest increased to 3.75% per annum (from 2.25%). The official rate is used to calculate the tax liability on employment-related beneficial loans and living accommodation.
As announced at the Autumn Budget 2024, in-year changes to the official rate of interest are now possible. Employers should be aware of the recent increase and keep an eye out for further changes to ensure that they correctly value and tax any such benefits.
Publications | International developments
Spain enters 2025 with significant new tax law | Osborne Clarke
New coalition in Belgium agrees proposals for major tax reforms | Osborne Clarke
Tax Liability Insurance opportunities: A Comprehensive Guide for businesses | Osborne Clarke
Please get in touch with your usual Osborne Clarke contact or one of the experts below if you have any queries or would like to discuss further.
