The Government has published an extensive consultation on the recommendations made by the Office of Tax Simplification (OTS) for reducing the complexity of tax-advantaged share plans and the burden on companies. The consultation is open until 18 September 2012 and the result will be published in the autumn.
Two of the main OTS recommendations are definitely to be taken forward, subject to suitable safeguards:
- a move to self-certification for Share Incentive Plans, Save-As-You-Earn (Sharesave) schemes and Company Share Option Plans (approved schemes); and
- the removal of unnecessarily prescriptive requirements.
In addition, the consultation seeks views and evidence on the extent to which the CSOP is still relevant, given the decline in its use over the last decade.
Most of the remaining OTS recommendations are to be given further consideration after the consultation. For any of these that are taken forward, it is intended that draft legislation is published in the autumn of 2012, to come into force in summer 2013.
However, there are a number of the recommendations that are not being taken forward, on the grounds of cost or risk of abuse.
The proposed changes will be of interest to any UK-based company that operates one or more of these plans. More information is contained in our briefing.