Five key questions for successful share plan administration

Managing any employee share plan or share option plan, and carrying out the administration, can be a huge task which can get on top of your already hectic work life. HMRC requires all plans and relevant events to be registered with them, and it’s all too easy to miss HMRC deadlines, or to find out you’ve incorrectly reported an event that impacts on your share plan. Failing to do this can and will result in fines and penalties.

Here are 5 key questions you need to answer to make sure you don’t end up in that position:

  • If you have the most popular share plan, the Enterprise Management Incentive (EMI), are you fully aware of all the different things that can disqualify the favourable tax treatment – for example, if any employee goes on sabbatical, or if there is a change in the company’s share structure?
  • Do you know how to deal with leavers under your share scheme – in particular, where the reason for leaving will impact on tax treatment as in the case, for example, with a Share Incentive Plan (SIP)?
  • Are you liaising with your Company Secretary to keep Companies House records up to date – for example, filing a Form SH01 for an allotment of shares, and updating your CS01 on an annual basis?
  • Do you have all your information in place to enable you to file your share plan annual return in time (the annual return window runs from 6th April to 6th July)?
  • Do you know the dates at which options may lapse – and do you need to let your employees know about the lapse dates in advance?
  • Do you have clear procedures in place to ensure that all vital transactional, filing and compliance reporting activities are being reported properly?

Knowing all these things may become difficult if you are an already busy person with other tasks!

The concerns above may explain why many companies look to go somewhere else to manage their share plans. At RM2, we act as plan administrator for most of the share schemes we create. In fact, our service is so comprehensive it is not uncommon for our Operations Team to pick up and rescue share plans that have been poorly managed elsewhere.  From small businesses to big well-known organisations, RM2 has worked with companies of all sizes.

If you are currently encountering problems with your share plan administration, you’ve realised from the above that it might be something to pass to an expert, or you simply wish to explore a competitive quote against your current outsourced provider, then we would be pleased to arrange a free consultation in order to discuss a health check or plan administration outsourcing for you. For further details please contact us at enquiries@rm2.co.uk to set up a call with one of our advisers.