Employer Share Scheme Reporting

There are several annual reporting obligations for employers who operate share schemes for their employees which are normally due by 31 March following year end. Due to the COVID-19 pandemic, Revenue have extended the 2019 share scheme reporting deadline to 30 June 2020. Also, Revenue recently issued updated guidance on the process for filing RSS1, KEEP1 and ESS1 forms.

Share options and KEEP option schemes

In respect of share options and other rights granted to directors and employees, employers are obliged to provide information to Revenue in relation to the grant, assignment or release of rights, allotment of shares on the exercise of a right, or the transfer of any asset under rights granted. This requirement is applicable regardless of whether the share options are in the form of market value options, discounted options or nil cost options. The information is required to be provided on Form RSS1.

The Key Employee Engagement Programme (KEEP) provides for share options to employees and directors of certain small and medium enterprises. The form reports the grant, release, assignment and exercise of KEEP options by employees and directors. Complexities can arise where share options have been granted to cross-border employees and advice should be sought in this regard.

The 2019 RSS1 and KEEP1 forms must be filed by 30 June 2020.

For prior years, employers could upload the RSS1 and KEEP1 forms through Revenue’s secure file transfer service on Revenue’s Online System (ROS). This year, employers must now register with Revenue to confirm that they have a share scheme reporting requirement (SSR) via ROS in advance of filing the returns. Employers should allow sufficient time for SSR registrations in advance of the filing deadline to complete the additional registration as the process can take 2-3 working days.

APSS, ESOT and SAYE share schemes

In respect of Approved Profit Sharing Scheme (APSS), the trust of the scheme must normally file a Form ESS1 by 31 March following the end of the year in which the shares are allocated, or within 30 days of request by the Revenue. For prior years, a paper Form ESS1 was filed. For 2019, the Form ESS1 must be filed online. In order to facilitate this transition, Revenue have extended the 2019 filing deadline for ESS1 forms to 30 June 2020. The trust must register for the SSR via ROS, similar to the process for RSS1/KEEP1 forms outlined above. In order to complete this registration, the trust must be registered for income tax. 

In relation to Save As you Earn (SAYE) schemes, an employer must file a Form SRSO1 by 31 March of the year following the grant/exercise of the share options, or within 30 days of request by Revenue. This has been extended to 30 June 2020 for 2019 forms only. 

For Employee Share Ownership Trust (ESOT), the trust must file a Form ESOT1 by 31st March following the end of the year, or within 30 days of request by the Revenue. Again, this has been extended to 30 June 2020 for 2019 forms only. 

Revenue approval of a share scheme may be withdrawn for failure to comply with the reporting obligations above. Trusts must also file a Form 1 as a declaration of trust income and capital gains.

Restricted Stock Units

In general, Restricted Stock Units (RSUs) and other share award plans do not have to be reported separately as they are reported through the PAYE system. An employer who facilitated a real time tax credit through payroll for foreign tax paid on RSUs during 2019 must report the details to Revenue by as soon as possible but no later than the extended 2019 Pay and File deadline (12 November 2020). 

The Global Employer Services team in Deloitte can assist you with all Revenue reporting obligations for share schemes.