Changes to employee share plans
Save As You Earn (SAYE) Plans and Share Incentives Plans (SIPs) limits increase from 6 April 2014.
Individual annual SIP limits will increase by £300 to £1,800 per year for Partnership Shares, subsequently impacting on matching shares which can be awarded on a ratio of two matching shares for every partnership share purchased.
The annual limit for Free Shares that may be given to an employee will also increase by £600 to £3,600.
The aggregate maximum monthly SAYE savings contribution doubled from £250 to £500 for employees across all SAYE saving contracts.
Companies offering SAYE plans and SIPs to their employees are required to review their rules to identify if the new limit can be applied without the need to amend the rules. It is anticipated that most plan rules will not require amendment.
Registration and Self-certification
Also announced in the Autumn Statement, from 6 April 2014 companies will be required to register all existing and new employee share plans online with HM Revenue & Customs (HMRC). They are also required to self-certify existing and new Company Share Option Plans, SAYE plans and SIPs, confirming they meet legislative requirements.
Companies will also be required to submit their annual share scheme returns via HMRC online filing.
HMRC will no longer be approving any new tax-advantaged share plans or amendments going forward.
All plan arrangements must be registered or registered and self-certified by 6 July 2015 or tax advantages will be lost, penalties will also be imposed for late submission.
Full details on the SAYE/SIP increases and answers to a number of queries HMRC have received along with a timeline of key dates for self-certification, registration and online filing can be viewed on the following link at the HMRC website.
If you have any questions please do not hesitate to contact me.
Louise Drake | National Sales Manager | 01274 263101