Growth shares, employees, directors and ITEPA S431

A summary of the steps employers and recipients should take when awarding growth share

When awarding growth shares to employees or directors, two actions need to be taken:

For growth share recipients

To avoid any future income tax charges under the 'restricted securities legislation', employees and directors must complete an ITEPA S431 election within 14 days of accepting their growth shares. 

Download the form here.

Certain web browsers (e.g. Chrome) don't open the HMRC form. You can either try a different browser or right-click the link, click ‘Copy Link Address’ and paste the address in a new tab. 

For companies distributing growth shares

    You don't need to complete an initial notification for employee growth shares when first granted, but you do need to submit an annual notification before 6th July to declare that an election has been made in the previous financial year.

    This is called an Annual other ERS notification


    Go to Share schemes > Annual notifications in your Vestd side navigation for guidance on how to submit your annual notification to HMRC. 


    This is a similar process to the EMI initial notification, in that you first need to notify
    them of the existence of the scheme, then return after about 5 working days to notify the details. So it's important to leave plenty of time before the 6th July deadline. 


    It's not uncommon for companies to complete the S431 form before passing it on to the recipient to sign. Either way, both parties must sign the document and the employer needs to maintain a copy. 


    The employer doesn't need to submit the document to HMRC within the 14-day window, but they will need it when submitting their annual notification to declare that an election has been made. 

    Read our help guide for more information on when an ITEPA S431 is needed and how to complete the form.  


    Our team, content and app can help you make informed decisions. However, any guidance and support should not be considered as 'legal or financial advice.'