HMRC Updates ERS Scheme Registration Guidance for Employers

• HMRC has updated its guidance on Employment Related Securities (ERS) scheme registration, including revised deadlines and agent authorization procedures.
• New deadlines for Enterprise Management Incentive (EMI) options granted after April 6, 2024, require reporting by July 6th following the tax year of grant.
• Non-tax-advantaged schemes must be registered by July 6th following the tax year when the first reportable event occurred.
• Employers must save copies of ERS returns or notifications before submission, as the online service will not retain them for future access.
• Missing ERS scheme registration deadlines risks the loss of tax benefits for both employers and employees.

Employers must save a copy of their ERS return or notification *before* its submission, as the online service does not retain these details, meaning they will be inaccessible once submitted.

HMRC has recently issued significant updates to its guidance concerning the registration of Employment Related Securities (ERS) schemes, providing crucial clarifications for employers and their agents. The revised information details the procedures and timelines for notifying HMRC about new ERS schemes, aiming to streamline compliance processes. These changes encompass how employers can add ERS to their HMRC Online Services and the steps required to complete the registration of such schemes.

A notable revision involves the section dedicated to authorizing agents for ERS returns. The updated guidance now explicitly outlines the steps necessary for an agent to gain authorization to utilize the ERS online service, including information on the two distinct methods available for agent authorization. Furthermore, specific instructions have been incorporated to guide employers on how to authorise an agent to submit ERS returns on their behalf, ensuring proper representation and submission.

The updated guidance also addresses several other administrative aspects. Sections previously covering late registrations and the termination of an ERS scheme have been removed, with new, dedicated guidance now linked for these specific scenarios. Employers will also find updated instructions on locating their ERS reference number, alongside new information designed to support both late registrations and the submission of nil returns. Additionally, a Welsh translation of the guidance has been made available, broadening accessibility for users.

The updated HMRC ERS scheme registration guidance places a strong emphasis on adherence to specific deadlines for reporting ERS schemes, underscoring the potential loss of tax benefits for both employers and employees if these are missed. For new tax-advantaged schemes, registration must occur by July 6th following the tax year in which they were established. Failure to meet this deadline necessitates following a separate late registration process.

Crucially, the guidance revises the reporting timelines for Enterprise Management Incentive (EMI) options. For EMI options granted before April 6, 2024, employers are required to inform HMRC within 92 days of the grant date. However, for options granted on or after April 6, 2024, the EMI options reporting deadlines HMRC has shifted to July 6th following the end of the tax year in which the grant took place. For instance, an option granted between April 6, 2025, and April 5, 2026, would need to be reported by July 6, 2026.

Similarly, non-tax-advantaged ERS scheme registration now has a clear deadline: July 6th following the tax year in which the first reportable event occurred. This includes events such as the acquisition or disposal of securities, or the assignment or release of securities options. An example provided indicates that if the initial reportable event occurred between April 6, 2025, and April 5, 2026, registration would be due by July 6, 2026. The guidance also clarifies specific conditions under which an ERS end-of-year return is not required for non-tax-advantaged schemes.

Employers must be aware of several administrative requirements detailed in the updated guidance to ensure seamless ERS compliance. A critical instruction mandates that employers save a copy of their ERS return or notification *before* its submission. This is because the online service does not retain these details, meaning they will be inaccessible once submitted. This emphasizes the importance of maintaining thorough internal records.

Furthermore, the process for registering as an employer to obtain a PAYE reference number has seen a change in processing time, which can now extend up to 30 working days. This extended timeframe should be factored into planning for new employers. The guidance also reiterates that before any ERS scheme can be registered, the employer must first complete their own employer registration. In scenarios where an employee is engaged through an Employer of Record (EoR), the EoR retains the full responsibility for submitting all necessary ERS returns, ensuring compliance regardless of the employment structure.

Lawyers and compliance officers must review the updated HMRC guidance on Employment Related Securities (ERS) scheme registration, particularly the revised deadlines for Enterprise Management Incentive (EMI) options and non-tax-advantaged schemes, to ensure client compliance and prevent loss of tax benefits. They should also note changes to agent authorization procedures and the critical need to save copies of submitted returns as the online service will not retain them.

Source: Original reporting via GOV.UK guidance update