Employee Share Schemes in Ireland: KEEP, Share Options and Revenue Reporting

Employee share schemes in Ireland let a company reward staff with shares or rights to shares, but each type is taxed differently and carries its own reporting. This guide summarises what Revenue's own pages say about the Key Employee Engagement Programme (KEEP), unapproved share options, restricted shares and the returns employers file. It is aimed at finance, HR and payroll teams in Irish companies and is general information rather than tax advice. We do not state tax rates, because the examples on the Revenue pages are illustrations only.

Share awards are one kind of non-cash reward; others are covered in our guide to benefit in kind for employers in Ireland. Because the pages below carry different dates, we give each one's date where it was shown.

KEEP: the Key Employee Engagement Programme

Revenue's KEEP page (published 30 March 2026) describes KEEP as a tax-efficient share option scheme for small and medium enterprises. It states that you do not require Revenue approval to offer KEEP options to your employees. If the conditions are met, any gain an employee realises on exercising a KEEP option is exempt from income tax, the Universal Social Charge (USC) and PRSI. The page says qualifying depends on conditions relating to the employee, the company and the share options, and it points to Chapter 9 of the Share Schemes Manual for detail.

On the page, the option conditions include that options cannot be exercisable within 12 months of grant or more than ten years after grant, that the option price must be no less than the market value of the same class of shares at grant, and that the shares must be ordinary, fully paid-up shares in a qualifying company.

A date discrepancy worth checking

The KEEP page published 30 March 2026 says options must be granted between 1 January 2018 and 1 January 2029. Chapter 9 of the Share Schemes Manual, last updated November 2025, says options are covered if granted from 1 January 2018 to 31 December 2025 and that options granted from 1 January 2026 do not qualify. The two pages differ, and the Revenue page is the more recent. We cannot tell from the pages we read how the difference arose. Before granting any KEEP option, confirm the current end date with Revenue and with your adviser.

Other points from Chapter 9

The manual (November 2025) sets out conditions for the qualifying company, for qualifying individuals, and for the option itself, including a monetary limit, a minimum working time for the individual and an ownership cap. Those figures can change, so we do not repeat them. The manual also explains that if a qualifying condition ceases to apply the option is treated as an unapproved option, so income tax, USC and PRSI apply to the gain. From 1 January 2024 that tax is collected through PAYE by the employer. The manual notes that KEEP falls within EU State aid rules, so additional reporting and publication requirements apply.

Unapproved share options

Revenue's page on unapproved share options (published 13 February 2026) explains the timing. Short options, which are exercisable within seven years of grant, are not taxed at grant. Long options, exercisable more than seven years after grant, are taxed at grant if the option price is below market value. Any gain on exercise, assignment or release is taxable, with income tax, USC and employee PRSI applying.

For employers, the page says that for exercises, assignments or releases on or after 1 January 2024, tax must be deducted through payroll. Before that date the employee was a chargeable person who paid a separate tax within 30 days of exercise. The page says employer PRSI is generally not due on share option gains, subject to conditions, and that cash payments to release an option are subject to PAYE including employer PRSI. Where tax was paid at grant on a long option, the page explains it is credited when tax is calculated at exercise. Worked examples on the page use illustrative rates, and the page tells employers to use the rates on the employee's most recent Revenue Payroll Notification.

Restricted shares

Revenue's page on restricted shares (published 3 January 2025) describes shares an employer restricts the employee from disposing of for a set period, which can include shares acquired by exercising an option. It says the restriction must last at least one year. Income tax, USC and PRSI are due on the acquisition date rather than on later sale, and the taxable amount is the market value at acquisition less any amount paid, reduced according to the length of the restriction. If the restriction is later shortened or lifted, the tax paid is adjusted. On a later sale the employee may owe capital gains tax and, the page says, must report the disposal to Revenue even if no tax is due, because the employer will not report it.

Reporting: which return for which scheme

Revenue's share reporting page (published 19 March 2026) lists the employer returns:

The page does not state a filing deadline, and it does not mention penalties. The Share Schemes Manual Chapter 9 states that the KEEP1 return is due by 31 March of the following year, and that failure to comply can cause the company or group to lose qualifying status. Because filing rules and forms are updated, confirm the deadline and the correct form for each scheme and year on the Revenue pages.

Who the employee is matters

An employee's tax residence can affect how share income is charged. Revenue's rules are explained in our guide to tax residency for individuals in Ireland. We have not covered how residence interacts with each type of share scheme and recommend checking the Share Schemes Manual if staff work across borders.

Keep share awards separate from pension obligations

Share awards are separate from workplace pension duties. If your employees are covered by the new auto-enrolment system, see our guide to auto-enrolment and MyFutureFund contributions. We have not covered how share awards interact with that system.

A practical approach

Our suggestion: keep a register of every award with grant date, scheme type, exercise price, vesting or restriction period and the Revenue return it feeds. Agree with payroll before any exercise date who will calculate and deduct tax. Check the Revenue page for the scheme type on the day, because dates and forms are updated. Dublin companies with international staff or investors should also take advice from the outset.

Learnsignal's offices are off Baggot Street in Dublin, and we offer in-person training from there. For current details, see our CPD pages.

Frequently asked questions

Do I need Revenue approval to offer KEEP options?

Revenue's KEEP page says no: you do not require Revenue approval to offer KEEP options. You must still meet the conditions and file the KEEP1 return.

Is tax on share option gains collected through payroll?

Revenue's unapproved options page says yes for exercises, assignments and releases on or after 1 January 2024. Before that date the employee paid a separate tax within 30 days of exercise.

Which form reports unapproved share options?

Revenue's share reporting page names Form RSS1 for unapproved share options and other rights to acquire shares or assets.

What happens if a KEEP condition stops being met?

The Share Schemes Manual says the option is then treated as an unapproved option, so income tax, USC and PRSI apply to the gain on exercise.

Where do I find current limits and deadlines?

In Chapter 9 of the Share Schemes Manual and on the share reporting page on revenue.ie.

This article is general information and not tax advice. Check the current Revenue pages before granting or reporting any award.