Key Benefits
- Apply detailed tax rules for employee share & option schemes, including income tax and national insurance implications, and conditions for tax-advantaged treatment
- Strengthen your ability to assess liabilities and structure schemes correctly by understanding risks in non-tax-advantaged arrangements
- Build practical expertise in analysing ERS issues to support accurate reporting and compliance in real scenarios
Do You Need to Attend This Course?
Tax and reporting implications of employment-related securities training is a ‘must know’ for:
Professionals dealing with the tax compliance of individuals in receipt of ERSs and/or the companies issuing them
Redcliffe’s course is a ‘nice to know’ for:
Non-tax professionals looking to understand tax implications for individuals and companies who are party to ERSs.
Technical Content
Introduction to Share Awards
Employment-related securities definition
Phantom share awards
Scope of legislation (ITEPA)
Exception – family transactions
Basic Principles
Income tax
National insurance
Capital gains tax on shares issued to employees’ awards
Restricted Securities
Normal tax rule exceptions
Arising tax charges when restrictions are removed
Elections that can vary from the normal tax rules
Convertible Securities
Normal tax rules
Exception
Calculations
Shares Artificially Suppressed in Value
Charge on acquisition
Shares Artificially Enhanced in Value
De minimis exception
Charging rules
Shares Acquired at Less Than Market Value (If Not Caught by Items Above)
Amounts treated as employment income
Securities Disposed of for More Than Market Value
Post-Acquisition Benefits Received Concerning Employment-Related Securities
Notional Loans
When they arise
Taxable amount
Example
Discharge of loan
Unapproved Share Options
Tax charge on exercise
Approved Share Schemes (Sharesave, CSOPs, EMI, SIPs)
Conditions
Tax charges
Internationally Mobile Employees
The importance of residence for tax charges
Calculation of chargeable UK income from employment share schemes reporting
Recent case law decisions
Using Share Awards in the Current Environment – Trading Salary for Shares
Annual Employment Related Securities Reporting of Share Schemes
ERS Case Studies
Calculations with restricted securities
Effect of the S431 election
Effect of the S430 election
Calculations with convertible securities
When notional loans arise and the consequent tax charges
Notional loans when the shares are disposed of
Share options for internationally mobile employees (foreign service income and taxable share income)
Training Objectives
Training at Redcliffe provides a clear understanding of the specific guidance, including rule exceptions
Participants identify when income tax and national insurance charges arise in connection with employment-related securities
Understand which elections can be made to vary the normal tax treatment and when they may be beneficial or disadvantageous
Determine conditions that must be met for a scheme to be ‘tax-advantaged’, including Sharesave schemes, Company Share Option Plans, Enterprise Management Incentive options and Share Incentive Plans
Participants review aspects of each scheme the company operates that are to be reported in the ERS annual return share schemes
Training Course Summary
Training helps participants to master the tax implications of employee share schemes and option ERS schemes. Participants discuss the various income tax and potential national insurance liabilities arising from non-tax-advantaged schemes and the conditions required for a scheme to be tax-advantaged.
Through several extensive examples, delegates learn how calculations work and the information required for reporting annually to HMRC regarding share schemes in the annual employment-related securities return.
Your trainer
Course Trainer · 9 yrs experience
- Corporate Tax Courses
Training is delivered by a consultancy Director whose company specialises in taxation, share scheme advice, reward and lecturing. This expert has developed a specialised share scheme service for small businesses and advises FTSE companies on communication. Lecturing covers most aspects of Direct Taxation, and he has a particular interest in employment taxation and transfer pricing - posing unusual, conceptual challenges.
Working for Henderson for nearly 9 years prior, he led the Share Schemes team for part of this time. He completed the level 7 CIPD Master's qualification during his time here.
This expert has been with Australia Mutual Provident (AMP), helping establish one of the first Share Incentive Plans (SIP) for large companies in 2001. Such unusual circumstances sparked a call from the Revenue to discover how they could encourage more large companies to adopt SIP.
He began his career in taxation and, for the following 16 years, worked in three of the “Big Four” accountancy firms. He ultimately worked as a Senior Manager with Deloitte & Touche, bringing experience including profit-related pay, share schemes, expatriate tax, tax investigations, reward management, US taxation, transfer pricing and corporate tax.
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