Employment related securities bulletin 60 (April 2025)

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Employer鈥檚 National Insurance contributions joint elections 鈥� changes to the administration process

You and your employee can make a joint election to transfer the liability for employer鈥檚 National Insurance contributions to the employee, in specific circumstances.聽

On 28 April 2025 the government announced changes to simplify the administration of making a joint election.聽This change took effect from 1 May 2025.

If you use the HMRC pre-approved legal document when entering into a joint election, you鈥檒l no longer need to get our approval.

If you decide to use your own legal document you should send it to us for approval before asking an employee to enter into an agreement.聽It can take up to 30 days, for us to either:

give an approval
send a reply stating what changes are required or what information is needed

Whether you use the pre-approved or your own legal documents, you must keep copies for your own records and present them to us if requested.

You can read more information in the employment related securities manuals:

chapter ERSM170750 鈥� PAYE & NICs: NICs elections & agreements
section 2 鈥� 鈥榩urpose and scope of election鈥� of chapter ERSM170760 鈥� PAYE and NICs

You must submit a return or a nil return:

on or before 6 July 2025 to avoid receiving a late filing penalty
for every scheme that you鈥檝e registered on the聽employment related securities聽online service
using the correct and most up to date end of year return template 鈥� read the section 鈥楨nd of year return templates and forms鈥� in Employment related securities: detailed information

If you鈥檝e stopped being an employer and have ceased your PAYE scheme, you鈥檒l need to check if you need to cease your聽employment related securities聽scheme.聽

If you鈥檝e registered a scheme in error, or it鈥檚 no longer operating, you must:

tell us the scheme has ended
submit a return or nil return for the tax year in which the final event date falls

Save a copy of your return for your own records before you submit it.

Enterprise management incentive scheme notification 鈥� reminder聽

You must submit on or before 6 July 2025:

an end of year return for all your live enterprise management incentive schemes
a notification 鈥� if you鈥檝e granted options in the tax year 2024 to 2025

Save a copy of your return and notification for your own records before you submit it.

Finance Act 2025: Changes to Employee Benefit Trusts

At Autumn Budget 2024, the government announced several changes to the conditions which need to be met for a transfer into an employee benefit trust (EBT) to be exempt from Inheritance Tax, with effect from 30 October 2024. 皇冠体育appse changes were introduced alongside several other changes to the regime for employee ownership trusts (EOTs).

皇冠体育app changes to employee benefit trusts have now been legislated in sections 58 to 60 of Finance Act 2025. 皇冠体育app new legislation amends sections 13 and 28 of Inheritance Tax Act 1984 to:

make sure it is clear that the restrictions on connected persons benefiting from an employee benefit trust must apply for the lifetime of the trust
restrict the Inheritance Tax exemption to where the shares have been held for 2 years prior to settlement into an employee benefit trust 鈥� where there has been a share reorganisation, the shares previously held will be taken into account in considering the 2-year holding period
make sure that no more than 25% of employees who can receive income payments should be connected to the participator in order for the employee benefit trust to benefit from favourable tax treatment

For more information, read the tax information and impact note 鈥� taxation of employee ownership trusts and employee benefit trusts announced at Autumn Budget 2024.

Further guidance will be available shortly in the Inheritance Tax manual.

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