News

Company obligation to notify share transactions by 6 July 2017 Action required!

HMRC require all companies to notify them of a wide range of transactions in shares and securities.  This is drawn widely (to include shares, debentures and loan stock held by an employee or a person connected to them) and, based on our understanding of your affairs, we believe it is likely to apply to you.  

Companies must take action to comply with these obligations to minimise the risk of losing valuable tax reliefs and incurring penalties.

Who

The notification requirement covers any company that operates an unapproved share plan for employees or directors.  It also covers companies in which employees or directors have acquired shares or securities. In most cases, any share transactions involving employees or directors are reportable.

With the change to the online registration also comes a change in who must deal with certain aspects of the registration and notification process. Only the company can perform the initial registration of its share plans (although we can guide you through the process). The ERS service is part of the existing PAYE online service and companies can select to add this service whilst logged onto the HMRC website: https://online.hmrc.gov.uk/paye. Once the company has completed its online registration, if you wish, we can enrol as agent for the company in relation to ERS online services (this would not disturb your current Payroll Provider’s agent status with HMRC). We may then assist with online filing of annual returns.

When

The deadline to register the creation of a share plan or the issue of shares within the tax year to 5 April 2017, as well as the submission of the separate annual return notifications online with HMRC, is 6 July 2017.

However, as registration for the online service can take at least a week, it is recommended to register well in advance of the 6 July. In addition, if you require us to register as ERS online agents so that we may deal with the relevant annual return notifications this may take three weeks or more and therefore we recommend that you inform us as soon as possible. This will avoid the risk of late filing and the incurring of automatic penalties.

What

Common events that are disclosed in the notification (formerly Form 42) are (note that this list does not cover all reportable events):

  • the issue or transfer of securities;
  • the grant  or exercise of share options or of other rights to acquire shares;
  • the assignment or release of taxable securities options for consideration;
  • a rights issue or a bonus issue to employees by an employing company;
  • a change in the rights of shares held by employees;
  • a sale of securities that are ‘restricted’.

If an EMI option arrangement has been in place in the period, the equivalent notification (that was previously dealt with by the Form 40) must be made online.

Penalties

A return must be submitted for every share plan registered, even if it is a nil return. HMRC will no longer issue notices to file or reminders, it is now the responsibility of the company to first register online so that the appropriate annual return notifications may then be made.

  • Failure to file an annual return by 6 July will result in automatic penalties. Initially, a £100 penalty for missing the deadline will apply, plus additional penalties of £300 after 3 and 6 months if the return is still outstanding. If the return is more than 9 months late, a further penalty of £10 per day may also be charged.
  • Penalties of up to £5,000 can also be applied for failure to submit the return in an electronic format or for careless or deliberate errors.
  • Any failure(s) may also impact on HMRC.s risk rating for the company and could subsequently result in an unwanted visit from HMRC.

Action

It is widely acknowledged that the process of concluding whether or not there are transactions to report and how to accurately complete the forms is complex; a 52-page completion guide on the HMRC website for Form 42 is testimony to this.

To save both the trouble of dealing with this issue, we can assess the filing requirement, assist you with the initial registration process and then complete the online annual return notifications. Our fees for assisting you have remained the same as last year and are as follows:

Form 42

Up to 10 reportable events to disclose

 £385 plus VAT

EMI 40

Reportable events to disclose

 £250 plus VAT

Form 42 or EMI 40

Nil return

 £100 plus VAT

If there are more than 10 reportable events in the period then we will discuss the scope of our work and agree a fee basis with you.

Regarding the new ERS online service we would be happy to guide you through the process of registering the employment related scheme, thus removing any uncertainty you may have on how to meet the filing obligations and, in the process, free up your valuable time. Our proposed fee for registration is an additional £100 plus VAT.

Please contact us should you need any further assistance or advice.

-
Business owners -- oops, No! The self employed -- No, wrong again!   Unfortunately, Philip Hammond seems to have taken the wrong briefcase to the Commons today, because there don’t seem to be any winners. By Moonlight tonight, business...
-
  document.write(doDate('2016-11-24 09:00','d-NNN',1)); Some say he’s managing the fastest growing major advanced economy in the world and that if he wanted to make the tax system even more complex, he’d only need to make one speech per...
-
Claritas Tax, the boutique tax advisory firm based in Brindleyplace, Birmingham, is delighted to welcome Fiona Holloway to its team as an Associate Director.   Prior to joining Claritas, Fiona was UK head of tax at German Top Six accounting...
-
Today marks the globally celebrated publication of the Corporate LiveWire’s 2016 M&A Awards Winners Guide.  Mergers & Acquisitions provide the movements for global economic success and the M&A Awards recognise the achievements of...
-
A Warwickshire business which provides 3D computer aided design (CAD) software has secured an £8m investment from the Business Growth Fund (BGF) to support the acquisition of a Derbyshire rival. Solid Solutions Management Ltd is a reseller of...
-
Today has been a day dominated by sugary drinks.  After all, how would we get through 63 Budget announcements plus a “Business Tax road map” without a healthy dose of Coke and Dr Pepper?  There are times when aspartame is simply not...
-
A £50m-turnover Birmingham business which paints car parts for the likes of Rolls-Royce, Bentley and Aston Martin has secured a "significant" investment from the Business Growth Fund (BGF).  Paintbox Group was...
-
The Business Growth Fund ( BGF ) has made a multimillion-pound investment into a £70m-turnover plant hire and earthworks company in Shropshire that has been involved with landmark projects such as the Olympic Park and the Hinkley Point C...
-
A £10m-turnover provider of rail communication systems headquartered in Nottingham has secured a multimillion-pound development capital investment from funds managed by private equity firm YFM . KeTech was formed in 1999 and employs 65 staff...
-
You would be forgiven for wondering what exactly George  Osborne  has in common with the Ewing brothers of Eighties  Supersoap , “Dallas”, other than being delighted that he, and not Nicola Sturgeon, has all of the oil!...
-
RTS was founded by Richard Wells nearly 30 years ago and since then has consistently developed programmes designed to engage with motor manufacturers to develop frontline dealership staff. Malcolm Miller joined RTS four years ago in order to grow the...
-
In Roald Dahl’s famous story, the hero, George, deals with his problems by concocting a disgusting medicine to make them disappear.  George’s problem is, of course his grandmother who persecutes him and whom he believes is a witch! ...
-
APPLICATIONS ARE NOW CLOSED Taxation is a constantly changing and high profile field.  Here at Claritas Tax, we can offer you the opportunity to work in tax advisory, giving you a deep understanding of tax and how business transactions can be...
-
COVENTRY Chemicals, a manufacturer and supplier of cleaning products to the professional, retail and healthcare sectors, has received a £1.75m cash injection from Finance Birmingham. The cash will be used to support its growth, including plans for a...
-
Its Budget time again and in the run up to the announcement this year we had the added excitement of a Pre-Election Budget.  The excitement ceased however when George Osborne delivered the ‘Caretaker’ Budget, which to be fair is no surprise....
-
The Business Growth Fund (BGF) has supported Walsall-headquartered Brownhills Investments' growth plans with a seven-figure funding package, allowing its subsidiary to acquire a North East business. Durham-based Peterlee Glass was snapped up by...
-
For the second time this year, we are delighted to have supported Business Growth Fund with a new investment.  BGF have invested £2.6 million in BHR, a fluid engineering consultancy based in Cranfield.  Claritas, led by David Nolan and...
-
You will - no doubt - receive countless Budget emails setting out in great depth all of the items covered in the Budget.  Fortunately, you won’t get that from us! Rather than add to the acres of analysis of George Osborne’s announcements,...
-
We are delighted to have supported Business Growth Fund Plc with their investment in Rutland Cycling, a Leicestershire based specialist cycling retailer.  Claritas' work was led by David Nolan and Iain Wright and consisted of tax due diligence...
-
As a child of the 70s and 80s, Timbuktu was a far off exotic place where silly things happened.  In reality, it is a desert town in Mali, an impoverished central African country recently ravaged by war between Al Qaeda and the French-backed...
-
Bladon Jets, the Coventry company developing a range of revolutionary micro gas turbines, has been boosted by a fantastic £310,000 claim for Research and Development tax relief, prepared and submitted by Claritas Tax. To find out more, please read the...
-
I won't win any friends in the British press or the Houses of Parliament for defending tax planning, but it can be vital to business success, particularly when trading overseas. If the government wants to encourage exports, maybe it's time to stop...
-
Claritas has written an article for Perkins Slade Insurance Brokers on the importance of tax planning when companies start exporting.  Perkins Slade are based in Birmingham and are one of the UK's leading insurance brokers.  To read part 1 of...
-
George Osborne delivered his 4th Budget on Wednesday lunchtime, which we followed with a presentation at the National Motorcycle Museum.  With limited room for manouevre given the desire to stick to the deficit reduction Plan A, the Budget had few...
-
George Osborne will deliver the Coalition Government’s 4 th Budget on Wednesday 20 th March.  With the prospect of an unprecedented triple dip recession looming, will the Chancellor stick with his austerity and deficit reduction plans or will...