Are you ready for this year’s reporting?
Following the end of the UK tax year on April 5, 2025, annual share plan returns may now be filed online with HM Revenue & Customs (HMRC). All companies with open share plan registrations with HMRC are required to submit an annual return, even if it is a nil return (i.e., even if there was no share plan activity during the 2024/25 tax year).
| The deadline for submission is July 6, 2025. Please note that the submission deadline applies regardless of the fact that this is a Sunday. HMRC will not send companies a reminder to file their share plan returns. |
How to submit your return
The return will need to cover all reportable events that occurred between April 6, 2024 and April 5, 2025. Reportable events include:
- Options – The grant (including on a conversion / assumption), exercise, assignment or release for consideration (not a lapse for nil consideration) or the receipt of a benefit in connection with the option.
- Restricted Stock Units (RSUs) / conditional share awards – The grant (including on a conversion / assumption), vesting, assignment or release for consideration (not a lapse for nil consideration) or the receipt of a benefit in connection with the award.
- ESPP – The purchase of shares under share purchase plans (and potentially the grant of purchase rights).
The return needs to be filed by the entity that registered the plan with HMRC using the plan’s unique reference number. For those companies that do not regularly access HMRC’s website, now is the time to locate those log-in details or identify the person who has access. Ahead of the return season it may be worth adding more than one administrator to your Government Gateway account just in case your primary administrator is not available to log in and submit your returns ahead of the deadline. To set up a backup administrator, log into your HMRC business tax account and follow the guidance to add a team member.
The template forms and guidance on how to complete them can be found here.
As a reminder, non-tax-advantaged awards and plans must be reported on the “other” template. There are separate templates for each of the tax-advantaged CSOP, SAYE, EMI and SIP plans. If the template does not match the plan registration, the submission will be rejected.
Before submission, files uploaded to HMRC’s website will be checked for formatting errors by HMRC’s checking service. The files are format sensitive so companies are encouraged to check their files in advance of making the submission. This can be done here.
The website that HMRC introduced to report on the service availability of HMRC’s website and any planned downtime remains available. It can be accessed here.Important HMRC guidance
Net settlement withholding method
Please see HMRC’s updated guidance here regarding the net settlement of awards to cover withholding taxes, and the associated limitations which this has on claiming corporation tax relief in the UK.
Net settlement versus ‘sell-to-cover’ arrangements are reported differently in your ERS return, and this will therefore highlight to HMRC if net settlement is being used.
We are increasingly seeing HMRC challenge the corporate tax deduction position of companies using net settlement procedures. Given the HMRC challenges, we would urge you to get in touch with us if your company is using net settlement procedures.
EMI notifications
If you operate an EMI plan and you have granted options on or after April 6, 2024, you must submit your EMI notifications to HMRC by July 6, 2025. Failure to notify HMRC of your EMI option grants will mean that they do not qualify for beneficial EMI tax treatment.
Saving copies of ERS return and EMI notifications
You should save a copy of your ERS return and/or EMI notification for your own records before you submit it to HMRC. You should take screenshots of each page along with the confirmation page if you are filling in the details online instead of uploading a file.
De-register plan if no longer valid
You should de-register your plan if you have registered a plan in error or if it is no longer operating. Please note you must still submit an annual return for the tax year in which the final reportable event falls.
