Costly mistakes – errors on share plan returns

Each year the Employment Related Securities (“ERS”) service of HMRC issues penalties for share scheme returns not filed by the deadline date of 6th July. HMRC released the following statistics on the number of penalties issued for 2017/2018 tax year:

  • 9,253 first penalties issued (£100 penalty is automatically issued even if the return is one day late); and
  • 6,014 second penalties issued (an additional £300 charged after the return is 3 months late) That’s a total of £2.4m fines levied – just for not filing returns!

It will be interesting to read how many will receive penalties of a further £300 for their return being 6 months late, and then how many will start accruing £10 daily penalties once a return is 9 months overdue.

HMRC are asking for all companies to check they have filed their returns and that their address, and contact details are correct.

Common errors


As well as being late, share plan returns often include errors and HMRC have set out the 3 most common made by companies filing their returns:

  1. entering outdated or incorrect PAYE reference numbers;
  2. using drag and drop to fill in the return templates – which can result in Excel automatically (and wrongly updating columns such as the PAYE reference column; and
  3. not using pounds sterling currency in the return template (which means that the price paid to acquire the shares is shown as an inflated value.

Last year, RM2 filed 175 share plan returns for our clients covering Share Incentive Plans (SIP), Enterprise Management Incentives(EMI), Company Share Option Plans (CSOP) and many other variations,. We’re pleased to say that all were filed on time, and correctly. Share plan administration can be time consuming, and costly if you don’t get it right.

If your share plan administration is giving you a headache, give us a call to see if we can help. Contact us on 0208 949 5522 or email us at for a no obligation discussion on how we can help you with your plan administration.