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New market is designed to support liquidity in private markets
In its March 2025 Employment Related Securities Bulletin 59, HMRC drew attention to a new type of stock market aimed at facilitating the secondary trading of private company shares — the Private Intermittent Securities and Capital Exchange System (PISCES).
PISCES is designed to support liquidity in private markets by enabling regulated trading of shares in private companies. HM Treasury is expected to lay a statutory instrument before Parliament in May 2025 to formally establish the regulatory framework for the market.
While PISCES will be a regulated stock market, it is important to note that it will not be classified as a Recognised Stock Exchange (RSE) under section 1005 of the Income Tax Act 2007.
ERS reporting implications
Employers and agents completing Employment Related Securities (ERS) end-of-year returns should take care when reporting shares that are traded on PISCES.
Specifically:
- When asked whether the shares are listed on a recognised stock exchange, you must answer ‘no’ if the shares are traded on PISCES.
There are no other changes to the ERS reporting requirements as a result of the introduction of PISCES.
Tax implications for employees
A technical note outlining the potential tax consequences for employees trading their shares via PISCES was published as part of the Spring Statement 2025. Employers and advisers are encouraged to review this guidance to understand the impact on share-based remuneration and employee share schemes.
Looking ahead
The creation of PISCES marks a significant development in the UK’s private capital markets, offering private companies and their employees new opportunities for liquidity. However, it also introduces specific considerations for tax reporting and compliance, particularly in relation to share schemes and ERS filings.
Further updates are expected once the statutory instrument is laid in Parliament. In the meantime, employers should ensure that their reporting processes are updated in line with HMRC’s guidance.
Further resources:
Read more about PISCES on the London Stock Exchange’s website
Find pre-application support on the Financial Conduct Authority’s website