Employment and pensions

Valuations for tax-advantaged share plans | HMRC confirms extension to 120 days

Published on 26th Jan 2022

HMRC confirms extended window of 120 days for valuations agreed in connection with the grant of tax-advantaged options 

Companies operating tax-advantaged share plans such as enterprise management incentive (EMI) options typically seek to agree a valuation with HMRC in connection with the grant of options.

On 6 January 2022, HMRC updated its guidance for unlisted companies wishing to agree valuations. HMRC will accept that a value agreed can be used for up to 120 days (subject to there being no substantial change in the company’s circumstances or market situation during that period).

The valuation window was previously 90 days from the date of agreement, although a temporary extension to 120 days was granted for valuations agreed during the coronavirus pandemic. The update to HMRC's guidance puts the temporary extension on a more permanent basis.

As ever, it is important that options are granted within the agreed valuation window, and that any changes in circumstances that may affect the valuation are promptly brought to HMRC's attention. 

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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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