The Finance Bill 2010 published on 4 February 2010, contains a number of provisions relating to employee share incentives schemes.
Unapproved Share Schemes – Employer Reporting Obligations
Previously it was mandatory for an employer to report to Revenue share based awards that were either stock options or made under an Irish Revenue approved scheme. An employer is now also obliged to report all share awards made since 1 January 2009. Employers must file this information with Revenue by 31 March in the year after the end of the relevant tax year. The information must be filed on a new form which will not be available until April 2010. Due to the late availability of the new form, Revenue have confirmed that the deadline has been extended to 9 July 2010.
Restricted Shares
Relief is available by means of an abatement of the income tax charge where shares are awarded by the employer to the employee and the employee is restricted from dealing in the shares for a period of at least one year and the shares are held in a trust during the restricted period. A new provision requires that the trust in question must be established in Ireland or an EEA state and the trustees of the trust must be resident in Ireland or an EEA state.
Approved Profit Sharing Schemes – Anti Avoidance
Anti-avoidance provisions have been introduced in respect of approved profit sharing schemes. Revenue will only approve a scheme where they are satisfied that no loan or credit arrangement exists to enable some or all of the employees to participate in the scheme. In addition, it is not possible for shares in a service company, or a company that has control of a service company, to be used for approved profit sharing scheme purposes.
Approved Share Schemes – Reporting Obligations
The forms for returning information in respect of approved shares schemes for the tax year 2009 are now available on the Revenue website. Due to the late availability of the forms, Revenue have confirmed that in respect of the tax year 2009, the deadline for filing the returns has been extended from 31 March 2010 to 15 May 2010.
