Knowledge Base: EMI Option HMRC registration and reporting requirements

Jump to required section here:

• Step 1. Creating an EMI Option scheme
• Step 2. Building an EMI valuation
• Step 3a. Submit an Enterprise Management Incentives (EMI) notification
• Step 3b. Submit an Employment related securities return

Step 1. Creating an EMI Option scheme

When you create your scheme on FounderCatalyst and expect to issue EMI options, you should:

• ⁠Register for PAYE under your Government Gateway or One Login account - you can do this via the HMRC site. Even though your company may already be registered for PAYE, you may find that you need to register yourself too if you have an accountant who manages payroll for you.
• ⁠Register your EMI scheme(s) on the HMRC site

Whilst you don't need to register your scheme until you are due to file your EMI notification or returns, we'd recommend registering immediately as this process can be easily forgotten.

Step 2. Building an EMI valuation

We have a separate guide on building an EMI valuation

Step 3a. Submit an Enterprise Management Incentives (EMI) notification

You need to notify HMRC about the issue of EMI options, by 6 July following the end of the tax year the grant was made at. To undertake this process, you need to login and follow the HMRC process.

HMRC also publish more details of the submission format.

The sheet should include all options, including those that have since been terminated, lapsed and similar.

FounderCatalyst offers a sheet for download via the "EMI notifications" section on the option page. You should carefully check that the sheet matches your circumstances and is 100% correct before submitting to HMRC.

Note: This notification requirement is being removed for options issued after 6th April 2027 per HMRC bulletin 62.

Step 3b. Submit an Employment related securities return

You are required to submit a return each year, even if there have been no transactions (known as a 'nil return'). This yearly return (or nil return) needs to be submitted on or before 6 July for each registered scheme covering Employment Related Securities.

To undertake this process, you need to login and follow the HMRC process.

More details of the template and format are provided by HMRC

FounderCatalyst offers individual CSVs for download via the "EMI end of year returns" section on the option page. You should carefully check that the sheet matches your circumstances and is 100% correct before submitting to HMRC. Note: we only populate the "released, lapsed or cancelled" and "NonTaxable" files, if any of the other files are required, you need to populate these from scratch based upon the template linked above.

The sheet is a little confusing, but broadly the tabs are as follows and you only need to complete those sheets that are relevant in the period covered:

• EMI40_Adjustments_V4: only to be used when there has been a variation in the share capital of the company whose shares are under option, there has been an adjustment of the option price or there has been a change in the description of shares under option.
• EMI40_Replaced_V4: only to be used when options have been replaced in relation to a company reorganisation.
• EMI40_RLC_V4: only to be used where options have been released, lapsed or cancelled.
• EMI40_NonTaxable_V4: only to be used where there have been non-taxable exercise of options.
• EMI40_Taxable_V4: only to be used where there have been non-taxable exercise of options.