The Chartered Institute of Payroll Professionals ……………………………………………………………Policy News Journal
The consultation is particularly relevant for accounting and legal advisers of companies which offer non tax- advantaged share schemes, particularly multinational companies with UK employees.
The deadline for responding to this consultation is13 July 2016; by email to shareschemes@hmrc.gsi.gov.uk or by writing to Employee Shares & Securities Unit, HM Revenue and Customs, Room G53, 100 Parliament Street, London, SW1A 2BQ.
If you would like the Policy Team to respond on your behalf, please email us with NIC elections in the subject box.
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Consultation response on employee share schemes NIC elections 20 October 2016
The government has published their response to this consultation which states that there will be no change.
Background A consultation was published in April 2016 on whether companies with non tax-advantaged share schemes require the continued availability of a National Insurance Contribution (NIC) election. A NIC election is the means of legally transferring to the employee the Employer’s Class 1 NIC obligation on the occasion of chargeable events in connection with employment-related securities options, and with restricted or convertible employment-related securities. This consultation was designed to gather views and evidence from companies with non tax-advantaged share schemes about whether there is a need for the continued availability of a NIC election. NIC agreements will continue to be available. Response Government has carefully considered the responses generated by this consultation and whilst there has been a change to the US accounting rules, it is clear that there is still a need to retain the NIC elections facility. They provide a protection that is not provided under NIC agreements. Therefore Government is to take no further action and retain the facility to make NIC elections.
Read the full Summary of Responses .
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Impact of the Autumn Statement announcement on Employee Shareholder shares 25 November 2016
Within hours of the Chancellor of the Exchequer taking his seat after delivering his first Autumn Statement report, updated guidance on the Income Tax treatment of Employee Shareholder shares has been published by HMRC.
The reason for the unusual haste, for those familiar with such schemes, will have been apparent.
The tax benefits of Employer Shareholder Status (ESS) are to take effect from 1 December 2016 and so for anyone with outstanding agreements at the time of the announcement, only a small window of opportunity then remained for agreements to be finalised due to the requirement that 7 days must pass between an employee receiving relevant independent advice on the offer and the arrangement being finalised.
Employer Guidance has been updated to reflect the changes.
The government will legislate to close the status itself to new entrants at the next legislative opportunity.
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The Chartered Institute of Payroll Professionals
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