Consultation response on employee share schemes NIC elections

20 October 2016

20 October 2016

The government has published their response to this consultation which states that there will be no change.


A consultation was published in April 2016 on whether companies with non tax-advantaged share schemes require the continued availability of a National Insurance Contribution (NIC) election.

A NIC election is the means of legally transferring to the employee the Employer’s Class 1 NIC obligation on the occasion of chargeable events in connection with employment-related securities options, and with restricted or convertible employment-related securities.

This consultation was designed to gather views and evidence from companies with non tax-advantaged share schemes about whether there is a need for the continued availability of a NIC election. NIC agreements will continue to be available.


Government has carefully considered the responses generated by this consultation and whilst there has been a change to the US accounting rules, it is clear that there is still a need to retain the NIC elections facility. They provide a protection that is not provided under NIC agreements. Therefore Government is to take no further action and retain the facility to make NIC elections.

Read the full Summary of Responses.