Annual reporting for tax-advantaged share schemes

By Tolley in association with Karen Cooper and Jeremy Cavendish, Cooper Cavendish LLP
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The following Employment Tax guidance note by Tolley in association with Karen Cooper and Jeremy Cavendish, Cooper Cavendish LLP provides comprehensive and up to date tax information covering:

  • Annual reporting for tax-advantaged share schemes
  • How to file an online annual return
  • Nil returns
  • Checking annual returns
  • Declaration that the annual return is correct and complete
  • Late annual returns

If a company is operating any tax-advantaged share scheme or arrangement (including EMI), it is required to make an online annual return by 6 July after the end of the tax year in which the scheme or arrangement was registered and each tax year during the life of the scheme or arrangement. This includes where the company is making a nil return (see below).

HMRC’s 6 July deadline is a strict one and failure by a company to make the relevant annual return and / or declaration will have serious consequences, including penalties and, in respect of certain tax-advantaged schemes, the loss of tax relief.

It is therefore essential that companies operating these types of schemes are familiar with and fulfil their compliance obligations. HMRC has no obligation to issue reminders to a company about making its annual return(s). It is therefore important that the company is prepared to make the annual return(s) on time. The person responsible for making an annual return submission may find it helpful to set electronic calendar reminders in the period leading up to the deadline.

How to file an online annual return

The company needs to use HMRC’s ERS service to file annual return(s). The company will not be able to file an online annual return until the relevant scheme or arrangement has been registered with HMRC and the scheme or arrangement having been issued with a unique scheme reference number (see the Registration and self-certification of tax-advantaged share schemes guidance note).

HMRC strongly recommends that a company uses its templates as this will limit the margin for error and rejected filings as a result, but it is possible for a company to create its own template and HMRC has produced technical notes to support a company in this process. These are available for each tax-advantaged scheme and can be accessed by clicking the

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