Chapter 19 - Share Schemes - Employer Obligations

Question 1

PAYE and NIC

Answer 1

If shares are readily convertible, the income is also subject to NIC and both the tax and NIC is collected via the PAYE system. The PAYE due is collected from th employee’s salary and bonuses even if it reduces them to nil.
Even if the full amount has not been deducted from the employee it must be paid to HMRC by the due date.
If any PAYE is still outstanding after the 90 days, the additional tax itself is subject to Class 1 NIC as earnings and must be on their P11D

Question 2

Registration, Self-Certification and Reporting

Answer 2

All schemes must be registered with HMRC. SIPs, SAYE and CSOPs must be self-certified.
Employer must file an annual return online with HMRC by 6 July following the end of the tax year.
Penalties:
Immediately - £100 late filing
> 3 months - Additional £300
> 6 months - Additional £300
> 9 months - £10 a day
If a return has a material inaccuracy which is careless or deliberate then a penalty of up to £5,000 ca be levied.

Question 3

Notification of EMI Option Grant

Answer 3

The employer must notify HMRC within 92 days that the grant has taken place.