If your company operates a share scheme or if there have been any share transactions involving employees or directors in the tax year ended 5 April 2025 the company may need to submit an Employment Related Securities report to HMRC by 6 July 2025.
What is an employment related security?
Employment Related Securities are shares and share options issued to employees and directors in the course of their employment.
These can include shares issued under tax-advantaged arrangements such as the Enterprise Management Incentive scheme as well as any other shares issued to employees or directors.
They can also include loan notes.
What needs to be reported?
The company must notify HMRC of certain ‘reportable events’ involving employees and directors.
These include:
- The acquisition of securities including shares and loan notes by any individual by reason of their employment
- Any activities related to share options including the grant, exercise, cancellation, assignment, lapse or release of options
- The lifting or variation of any restrictions attaching to any securities held by employees
- Any conversion of securities
- Any disposal of securities
How do I file the ERS?
ERS reports need to be filed online in a prescribed format on a spreadsheet provided by HMRC.
There are separate spreadsheets depending on the type of ‘scheme’ including tax-advantaged schemes like EMI, CSOP, SIP and SAYE.
Transactions that fall outside the EMI or other tax-advantaged schemes should be reported on an ‘Other’ return.
What if nothing has happened during the year: do I need to do anything?
If you have previously registered with HMRC in respect of Employment Related Securities but there has been no activity during the year ended 5 April 2025, then a ‘nil return’ should still be filed by the 6 July 2025 due date.
What happens if we miss the ERS filing deadline?
HMRC may charge penalties for the late submission of ERS reports.
There is an automatic initial £100 penalty for missing the 6 July 2025 deadline.
Further penalties of £300 arise if the report is outstanding after 3 months and another £300 penalty if the report is more than 6 months overdue. Daily penalties of £10 per day may accrue if the ERS report remains outstanding at 6 April 2026.
There are also potential penalties for inaccuracies in reports.
Are there any exceptions?
There are limited exceptions and in particular share transactions that are in the normal course of domestic, family or personal relationships do not need to be reported.
HMRC also confirms that the acquisition of initial subscriber shares or the allotment of further shares prior to the commencement of a company’s trade do not need to be reported, subject to satisfying certain conditions.
How can we help?
RPG Chartered Accountants can advise on what needs to be reported to HMRC and assist with the filing of ERS returns.
You can also appoint us as agent to file the return on behalf of your company. However, if we are not already registered as your agent, it may take some weeks for HMRC to register us as your agent. It is therefore important that you take action as soon as possible to ensure that the reports can be filed by the due date.
Please contact our Manchester office by emailing info@rpg.co.uk or phone 0161 608 0000 for an informal discussion.
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