When employers provide employee benefits to their workers, they need to file a P11D form to inform HMRC about their value. This form provides details of the benefits and expenses employers provide to their directors and employees in a tax year. Read on to find out What is a P11D form? Who gets this form? What it is used for? What information is included in this form? Why do I need this form? When do you need to file it? Are there any exemptions available?
What is a P11D Form?
It is a statutory form or document where taxable expenses and benefits are reported to HMRC by your employer about the benefits you’re getting as an employee. These benefits include private medical cover, company cars, etc. Employers don’t need to declare everything, but this form covers a lot of things. The expenses and benefits reported here are not being subject to PAYE tax.
Your employer needs to submit this form to HMRC each tax year and should also provide a copy to you (employee) if you have received these benefits. If you haven’t received any taxable expenses or benefits, then you might not need to have this form.
This form includes the details HMRC needs to update your PAYE record against the value and type of any benefits you receive. The tax authority requires this form after the 5th of April each year
Who Gets This Form?
For getting this form, you must fulfil these conditions:
- You need to earn over £8500 or more during the tax year
- You need to get company benefits classed as an extra income
What is a P11D Form Used for?
This form is used to provide details of the benefits and expenses on which you need to pay tax. Employers are responsible to submit it to inform HMRC about the benefits, expense payments, and facilities provided. These are:
- Company cars and their mileage allowances and fuel
- Private car mileage allowances and fuel
- Company vans and motorcycles for private use
- Beneficial loans
- Living accommodation
- Assets transferred
- Payments for use of home telephones
- Credit card and non-credit card expenses payments
- Working from home
- Private medical insurance
- Other items, like childcare costs, etc
As a rule of thumb, anything that’s not part of the basic salary of an employee would be considered as an employee benefit. The rules may change from time to time. So you need to be up-to-date with it.
What Information is in a P11D form?
This form includes the basic information about the employee like the name, DOB, NI number and other details. The rest of the form will include the benefits that we have discussed above. It has different sections for each allowance and uses this information to calculate the tax an employee owes on the benefits.
Why Do I Need this Form?
It is important to get this form to see whether the information included here is correct or not. It tells the tax authority the benefits you’re receiving for adjusting your tax code. With this form, you can work out whether you’re paying the right amount of tax or not based on the benefits you’re getting. If you don’t have this form, you’ll pay too much or too little that can lead to future troubles.
When Does this Form Have to be Filed?
Whether you want to file it online or via paper, you need to file it before 6th July. If you file it late for another 2 weeks, you need to pay penalties on it. A £100 penalty is charged for every 50 employees on a monthly basis. HMRC might be strict if an employer makes a mistake on their P11D paperwork. And you might not be charged with a penalty if you make an honest mistake.
Are There Any Tax Exemptions on the Benefits?
Generally, no. As most of the benefits are charged with taxes. However, there’s a little reduction on things like:
- Fees and subscriptions.
- Business entertainment, travel and subsistence.
- Trivial benefits that are up to £50 (unless they’re part of a salary sacrifice arrangement)
Quick Sum Up
After giving this post a read, you have got detailed information on what is a P11D form and why you need to have it as an employee and employer. If you’re an employer and you’re unable to prepare and file your P11D form, you may contact our Cheap Accountants in London for help. On the other hand, if you’re an employee who’s unsure about the taxes you are paying on your benefits, contact our tax experts for assistance.
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Disclaimer: This blog is intended to provide general information on the P11D form.