We will be introducing some minor changes to the ERS end of year return templates from 6 April 2023 to improve the quality of the data we receive and achieve greater consistency in reporting between them.
The ERS end of year return template guidance and technical notes will be published in February 2023. The templates and submission checking service will be updated from 6 April 2023. We are providing advance notice of the changes that are going to be made so that customers can prepare the relevant information in time for end of year returns to be submitted.
Customers who use the HMRC template and currently provide accurate entries for all data fields in the returns do not need to take any action. However, those who currently do not submit entries into all fields will need to act when completion of the field becomes mandatory, as incomplete data could result in returns being rejected on submission.
1. Mandatory completion of the ‘PAYE reference of the employing company’ field
For all ERS end of year return templates submitted from 6 April 2023 completion of the ‘PAYE Reference of the employing company’ fields will become mandatory. The employing company should be the company that has the PAYE obligation. Completion of this field is currently optional on 4 out of the 5 current ERS end of year return templates.
Completion of the following columns on the ‘Other return’ will remain optional:
- grantor company PAYE reference
- PAYE reference of company whose securities under option
- PAYE reference of company whose securities acquired
2. Mandatory completion of the ‘Is PAYE operated Y/N’ field
Completion of this field will become mandatory on ‘Other ERS schemes and arrangements’ end of year return templates submitted on or after 6 April 2023. This field is already mandatory to complete on the other 4 ERS end of year return templates.
3. Mandatory completion of the National Insurance number field and amendment to column title headings
Completion of this field will become mandatory on all 5 ERS end of year return templates submitted on or after 6 April 2023. In addition, the wording ‘if applicable’ will be removed from the National Insurance number column heading titles.
In most cases, individuals included on an ERS end of year return should have a National Insurance number. However, there may be some exceptional circumstances where an individual needs to be included on a return but does not have a National Insurance number. In these circumstances, an alternative reference should be used only on the ERS end of year return. This reference is not a National Insurance number and should not be given to the individual or used in any other correspondence with HMRC. If provided, the ERS reference will not be used by or shared with any other HMRC services. If the individual is subsequently allocated a National Insurance number, the National Insurance number should replace the alternative reference in later returns.
Where there are exceptional circumstances, the required format for the alternative reference will be a total of 9 characters. This will be 2 letters, 6 numbers and one letter consisting of:
TN ― to indicate an ERS reference that cannot be used for any other purpose.
Employee Date of Birth in format DDMMYY (for example, 080403) ― this data will enable HMRC to trace the individual.
No ‘National Insurance Number Reason Identifier’ (X, Y or Z) ― this is to identify the reason why an individual does not have a National Insurance number.
X ― Under 16 years old.
Y ― Applied for a National Insurance number and is waiting to receive it.
Z ― Never paid National Insurance contributions as they have not been liable to UK National Insurance contributions — for example they’re not resident in the UK or are an ‘intra-company worker’ on transfer to work in the UK.
4. Change to the ERS end of year return templates column title heading to clarify that we’re asking for a HMRC valuation reference
The heading title of the ‘Share Valuation HMRC Reference’ columns will be amended from ‘If yes, enter the HMRC reference given’ to display ― ‘If yes, enter the HMRC valuation reference given’ on all the ERS end of year return templates. Template guidance will also be enhanced to clarify the reference number that should be input if a HMRC valuation has been provided meaning this field needs to be completed. There will not be any changes to the data captured on this part of the return.
Important note:
If you’re using your own template you’ll need to follow these changes so that the file can be submitted successfully. This includes changes to the column template headings which are:
- the heading title of all ‘Share Valuation HMRC Reference’ columns will be amended from ‘If yes, enter the HMRC reference given’ to display ― ‘If yes, enter the HMRC valuation reference given’
- the wording ‘if applicable’ will be removed from the heading title of all National Insurance number columns
The exact columns to be changed will be detailed in the updated technical specifications that will be published in February 2023.
Company Share Option Plan changes to the share options limit and share class restrictions from April 2023
Changes to the Company Share Option Plan share options limit and share class restrictions were announced on 23 September 2022. Both changes will take effect automatically from 6 April 2023. You do not need to revise existing scheme plans. We intend to provide further information on the changes in due course.
The ERS guidance, technical notes and the Employee Tax Advantaged Share Scheme User Manual will be updated to reflect the changes being introduced from April 2023.
Update to the ERS guidance
We have enhanced the guidance at ‘Tell HMRC about your Employment Related Securities (ERS) schemes’ to clarify when and how to:
- register for the ERS service
- register a new ERS scheme
- cease an ERS scheme
We will be introducing some minor changes to the ERS end of year return templates from 6 April 2023 to improve the quality of the data we receive and achieve greater consistency in reporting between them.
The ERS end of year return template guidance and technical notes will be published in February 2023. The templates and submission checking service will be updated from 6 April 2023. We are providing advance notice of the changes that are going to be made so that customers can prepare the relevant information in time for end of year returns to be submitted.
Customers who use the HMRC template and currently provide accurate entries for all data fields in the returns do not need to take any action. However, those who currently do not submit entries into all fields will need to act when completion of the field becomes mandatory, as incomplete data could result in returns being rejected on submission.
1. Mandatory completion of the ‘PAYE reference of the employing company’ field
For all ERS end of year return templates submitted from 6 April 2023 completion of the ‘PAYE Reference of the employing company’ fields will become mandatory. The employing company should be the company that has the PAYE obligation. Completion of this field is currently optional on 4 out of the 5 current ERS end of year return templates.
Completion of the following columns on the ‘Other return’ will remain optional:
- grantor company PAYE reference
- PAYE reference of company whose securities under option
- PAYE reference of company whose securities acquired
2. Mandatory completion of the ‘Is PAYE operated Y/N’ field
Completion of this field will become mandatory on ‘Other ERS schemes and arrangements’ end of year return templates submitted on or after 6 April 2023. This field is already mandatory to complete on the other 4 ERS end of year return templates.
3. Mandatory completion of the National Insurance number field and amendment to column title headings
Completion of this field will become mandatory on all 5 ERS end of year return templates submitted on or after 6 April 2023. In addition, the wording ‘if applicable’ will be removed from the National Insurance number column heading titles.
In most cases, individuals included on an ERS end of year return should have a National Insurance number. However, there may be some exceptional circumstances where an individual needs to be included on a return but does not have a National Insurance number. In these circumstances, an alternative reference should be used only on the ERS end of year return. This reference is not a National Insurance number and should not be given to the individual or used in any other correspondence with HMRC. If provided, the ERS reference will not be used by or shared with any other HMRC services. If the individual is subsequently allocated a National Insurance number, the National Insurance number should replace the alternative reference in later returns.
Where there are exceptional circumstances, the required format for the alternative reference will be a total of 9 characters. This will be 2 letters, 6 numbers and one letter consisting of:
TN ― to indicate an ERS reference that cannot be used for any other purpose.
Employee Date of Birth in format DDMMYY (for example, 080403) ― this data will enable HMRC to trace the individual.
No ‘National Insurance Number Reason Identifier’ (X, Y or Z) ― this is to identify the reason why an individual does not have a National Insurance number.
X ― Under 16 years old.
Y ― Applied for a National Insurance number and is waiting to receive it.
Z ― Never paid National Insurance contributions as they have not been liable to UK National Insurance contributions — for example they’re not resident in the UK or are an ‘intra-company worker’ on transfer to work in the UK.
4. Change to the ERS end of year return templates column title heading to clarify that we’re asking for a HMRC valuation reference
The heading title of the ‘Share Valuation HMRC Reference’ columns will be amended from ‘If yes, enter the HMRC reference given’ to display ― ‘If yes, enter the HMRC valuation reference given’ on all the ERS end of year return templates. Template guidance will also be enhanced to clarify the reference number that should be input if a HMRC valuation has been provided meaning this field needs to be completed. There will not be any changes to the data captured on this part of the return.
Important note:
If you’re using your own template you’ll need to follow these changes so that the file can be submitted successfully. This includes changes to the column template headings which are:
- the heading title of all ‘Share Valuation HMRC Reference’ columns will be amended from ‘If yes, enter the HMRC reference given’ to display ― ‘If yes, enter the HMRC valuation reference given’
- the wording ‘if applicable’ will be removed from the heading title of all National Insurance number columns
The exact columns to be changed will be detailed in the updated technical specifications that will be published in February 2023.
Company Share Option Plan changes to the share options limit and share class restrictions from April 2023
Changes to the Company Share Option Plan share options limit and share class restrictions were announced on 23 September 2022. Both changes will take effect automatically from 6 April 2023. You do not need to revise existing scheme plans. We intend to provide further information on the changes in due course.
The ERS guidance, technical notes and the Employee Tax Advantaged Share Scheme User Manual will be updated to reflect the changes being introduced from April 2023.
Update to the ERS guidance
We have enhanced the guidance at ‘Tell HMRC about your Employment Related Securities (ERS) schemes’ to clarify when and how to:
- register for the ERS service
- register a new ERS scheme
- cease an ERS scheme
