COVID-19: HMRC Guidance on Share Schemes

HMRC have issued further guidance on how employment-related securities will be affected due to the pandemic, including how arrangements will interact with the Coronavirus Job Retention Scheme.

Save as you Earn (SAYE)

HMRC guidance confirms that all employees that have a saving contract in place on 10 June 2020 are able to delay the payment of monthly contributions, beyond the allotted 12 months, if the delay is due to impacts from COVID-19.

The maturity date for the contract will be put back for the total number of months that the payments are delayed for.

SAYE contributions can continue to be deducted from payments that are received through furloughed payments from the Coronavirus Job Retention Scheme. Those who are unable to make monthly contributions from their salary, due to the pandemic, are able to pay by standing order instead.

Share Incentive Plan (SIP)

HMRC have further confirmed that payments to furloughed workers can constitute as salary and SIP contributions can be deducted from those payments.

SIP participants are already able to stop their deductions from their salary, however any missed payments due to coronavirus will not be allowed to be made up later on.

Company Share Options Plan (CSOP)

HMRC accepts that where employees and full-time directors are furloughed, options granted before the pandemic will remain qualifying on the basis that they were full-time directors and qualifying employees at the time of the grant.

Valuations

When EMI options are available to be granted HMRC can be contacted to agree an appropriate valuation. HMRC will normally grant EMI options within a maximum of 90 days following the agreement of the valuation by HMRC however, due to coronavirus HMRC have advised there may be delays with the process.

If there has been no change that may affect an appropriate value then:

  • any EMI valuation agreement letters that have already been issued, where the 90 day expires on or after 1 March 2020, can be automatically treated as being extended by a period of 30 days; and
  • any new EMI valuation agreement letters issued on or after 1 March 2020 will be valid for an extend 120 days.

Deadlines for registering new schemes and filing returns

Due to the effect of COVID-19 some employers have found it difficult to meet ERS tax obligations such as registering new schemes and filing returned by the 6 July 2020 deadline. If the difficultly to meet the obligations has been affected by the pandemic, HMRC will consider coronavirus as a reasonable excuse, however, you must explain how the coronavirus had an effect and pay the return as soon as possible.

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