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The complexities and barriers involved in unapproved employee share schemes have been set out in an interim report from the Office of Tax Simplification (OTS).
The project follows work on approved share schemes, published by the OTS earlier this year.
The review of their unapproved counterparts – option schemes, long-term incentive plans, deferred share schemes, and more ad hoc arrangements – aims to identify technical and administrative simplifications that could be used to make it easier for employers to introduce and run such arrangements.
Problems identified by the OTS include difficulties in managing schemes for international employees, issues with the share valuations (not just for unquoted companies), snags in meeting PAYE requirements, confusion around penalties, and complex administrative forms.
Final recommendations will be reported ahead of Budget 2013.
