Original content provided by BDO United Kingdom
What is P11D?
A P11D is a form that must be submitted to HMRC by an employer annually for each member of staff (including directors) that receives certain benefits and expenses considered taxable by HMRC.
The benefit values shown on the form enable HMRC to review the employee’s tax affairs for the relevant year to check that the correct amount of tax has been paid. It also allows them to update an individual’s tax code for the following year so that regular tax deductions will be closer to the expected overall liability.
The following list is not exhaustive but includes the types of benefits typically reported:
- Company Car/Fuel
- Company vans (provided for personal use)
- Private medical Insurance
- Employer loans over £10,000 (where no/low interest charged)
- Professional/Private memberships
- Accommodation
- Pecuniary bills paid by employer (accountancy etc).
Where an employer chooses to ‘payroll’ the benefits of employees, ie tax them along with employees’ monthly/weekly pay, these benefits do not need to be recorded on a form P11D.
The forms must be submitted to HMRC by 6 July annually and, in addition, the employer is also required to complete and return the P11D(b) which calculates employer Class 1A national insurance contributions which is due on certain benefits. There are penalties for filing late or incorrect P11ds.
A copy of the P11D form should also be given to the employee to enable them to complete their income tax return, review their tax deductions and/or allow them to prepare claims for tax relief.
We will be hosting an Employment Tax seminar on 25th and 27th of April and will be covering P11D compliance. Please get in touch with Geraldine Browne or Renee Dawson if you would like to register.