HMRC updates legislation on company share benefits

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Companies providing employees and directors with shares are required to report these benefits to HM Revenue & Customs (HMRC). The reporting includes the notification of share options granted to directors or employees within 92 days of the date of grant and an annual return of certain events. New reporting procedures were introduced by HMRC in 6 April 2014 requiring the notification to be made online.

HM Revenue & Customs (HMRC) have introduced a new online procedure called the Employment Related Securities (ERS) Online Service. The new procedure replaces paper forms required to be submitted by employers issuing shares or share options. This service must be used to notify the grant of options after 6 April 2014.

Employers and their agents will need to register EMI schemes using the ERS Online Service. The ERS service can be used to complete a notification of a grant of EMI options to 30 or less employees. However, companies notifying a grant of options to more than 30 employees must use and send an attachment that is downloaded from HMRC’s website in Open Document format (ODF). This template attachment should be opened using Excel version 2010 (or later) or LibreOffice 3.5 (or later), which is free software.

The annual tax return form EMI40 and form 42 for share schemes are no longer used in paper format for the 2013/14 tax year. Instead the annual returns must be filed online with HMRC by 6 July 2015.

Companies that have not yet acted will need to notify HMRC promptly so that they, or their agents, can register their schemes online and file notifications and returns by the relevant deadlines. Further details can be found at:

As with all such tax situations, advice should also be sought before proceeding. For further details call Alan Boby on 01295 250401 or email

Alan Boby
Ellacotts LLP


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