HMRC have released the March 2025 edition of the Employment-Related Securities (ERS) Bulletin. It contains some useful information and provides a reminder about this year's filing deadline. Here is our enhanced version.
Private Intermittent Securities and Capital Exchange System (PISCES)
- PISCES is a new stock market, likely to begin trading later in 2025.
- It will be a secondary trading market for private company shares.
- PISCES will not be a Recognised Stock Exchange (RSE) but a regulated stock market.
- When end-of-year ERS returns are being completed:
- Data about PISCES shares must be entered.
- The answer to 'Are they listed on a recognised stock exchange?' must be 'No'.
- There are no other changes to the ERS reporting requirements for shares traded on PISCES.
Neonatal care reminder
From 5 April 2025:
- Statutory Neonatal Care Pay and Leave (SNCP) will be introduced. This was covered in Agent Update: September 2024.
- This is aimed at reducing the burden for parents with children in neonatal care.
- Employers will be required to ensure that any notice given on the possible effects of deductions from salary in relation to a Share Incentive Plan makes reference to SNCP (as well as other statutory payments).
Non-domicile reform
- Income received from ERS may be eligible for Overseas Workday Relief (OWR).
- Due to the Abolition of the remittance basis, changes to OWR will begin from April 2025.
- OWR will continue to apply to certain types of employment income, including ERS income.
- The calculation of 'Foreign Securities Income' will be modified for income falling after 5 April 2025 (regardless of the date granted).
- Where an employee is entitled to the new OWR, income will no longer be treated as foreign securities income but instead treated as 'Securities Income'.
- Relief may then be available, separately through OWR, on the securities' income which relates to duties performed outside the UK in the qualifying year.
- HMRC will publish new guidance in their ERS manual from April 2025, but these will not affect any reporting requirements for 2025-26.
- HMRC have also confirmed that any questions relating to the non-tax advantage share scheme 'Other' template which makes reference to the apportionment for residence or duties outside the UK, will not change.
- However, the guidance note will be updated accordingly for these questions.
End-of-year returns
ERS returns deadlines:
- For 2024-25, an ERS return must be submitted by 6 July 2025.
- A full return or nil return must be made for any scheme currently registered.
- If a scheme has been registered in error, it can be stopped. An annual return will still be required for the tax year in which the final event date falls.
- You must ensure you use the correct and most up-to-date template for the relevant scheme.
- If you have ceased being an employer, you should consider whether you need to cease your ERS scheme.
Enterprise Management Incentive (EMI) Notifications deadline
- For 2024-25, EMI notifications must be submitted by 6 July 2025.
- End-of-year returns for all 'live' EMI schemes must also be submitted by 6 July 2025.
Saving copies of your ERS return and EMI notifications
- Before you submit your ERS end-of-year return or EMI notification, save a copy for your records.
- If you’re uploading an EMI notification attachment, you should save a copy of the file. If you’re filling in the details online, you should take screenshots of each page and save them, along with the confirmation page.
- You will not be able to access a copy of what you submit through the online service once you’ve submitted it.
ERS administrators
- HMRC have reported that people often have difficulty logging in to their ERS online services because only one person has login details for the site.
- They have advised that to prevent login difficulties, more than one person should have a note of the login details in case the primary administrator is unavailable.
Useful guides on this topic
Employee shares: the Employment-Related Securities rules
What are the tax consequences when a company gives shares to an employee or director? What are employment-related securities? What is best: shares or share options? How do you set up a share scheme?
Employment-Related Securities Update 2024
Employee shares, share options and shares schemes: a mini-CPD update on what's hot or not in Employment-Related Securities in 2023-24 and 2024-25.
EMI: Enterprise Management Incentives: at a glance
What is the Enterprise Management Incentive (EMI) scheme? What are the qualifying conditions? How do you set up an EMI share option scheme?
EMI: Checklist
EMI share option checklist for employers. What are the rules for setting up an EMI share option scheme? What does an employer need to do to create an EMI share option scheme?
Non-domicile: Rules from 5 April 2025
What are the changes to the 'non-dom' regime? What does this mean for non-doms currently using the remittance basis? How will Income Tax, Capital Gains Tax and Inheritance Tax be affected by the changes?
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