Employers providing expenses or benefits to employees or directors are required to notify HM Revenue and Customs (HMRC) of these taxable benefits and expenses and pay Class 1A National Insurance on these. The means of reporting these details to HMRC is via forms P11D and the benefit totals are summarized on form P11D(b).
Where an employer has not registered with HMRC to tax benefits through their payroll, then the P11D is the statutory form required by HMRC from UK-based employers detailing the cash equivalents of benefits and expenses they have provided during the tax year to their directors and employees. Examples of expenses and benefits could include: company cars and fuel, health insurance, travel and entertainment expenses, interest-free loans, etc. Employers providing benefits to their employees by way of a salary sacrifice arrangement also need to consider whether these benefits need to be reported on a P11D, under the Optional Remuneration Arrangement rules introduced by HMRC in April 2017. The P11D(b) tells HMRC how much Class 1A National Insurance employers need to pay on all the expenses and benefits they have provided.
As many will already be aware, P11D forms for the tax year running 6th April 2020 to 5th April 2021 must be filed by 6th July 2021 and the associated Class 1A NIC paid by 22nd July.
As these deadlines approach, activpayroll can help customers and prospects alike with their P11D preparation and reporting requirements.
activpayroll offers a comprehensive solution to P11d preparation. The points below provide an overview of the steps we take to complete the process:
- Sort and evaluate Excel data provided by the Customer in the Information Schedule
- Match benefits data to the respective employee information using our payroll software
- Import employee data into our P11d software
- Verify data import with respect to the Information Schedule
- Create a benefit report for customer approval. We will produce a report to meet our customers’ needs, for example, split by department.
- Process any changes as requested by the customer
- Generate P11d(b) outlining the employer Class 1A liability
- Generate P11ds, sent in pdf format to the employer for distribution to employees
- Submit P11ds to HMRC on the customer’s behalf
- Review any updated tax codes generated as a result of the P11D submission, and import into our payroll system
If you would like to discuss your specific needs in greater detail or require further assistance, please contact our Audit & Compliance Manager, Simon Wright via email email@example.com.
To discover what additional services activpayroll can offer, please visit our What We Do page.