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P11D forms: What you need to know

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The statutory P11D form is used by HMRC to ask UK employers to outline the cash equivalents of expenses, allowances and other benefits given over the tax year to directors and staff members or members of their family or household who earn over £8,500 per year.

Essentially, this form is all about reporting benefits in kind, from private healthcare to interest-free loans, season ticket loans or company cars, to name just a few.

Because these benefits, in effect, enhance your salary, National Insurance contributions may have to be paid on them (by the employer, not the individual staff member concerned).

Equally, the employer is responsible for filing this documentation.

P11D forms must be filed by the 6th July after the relevant tax year. So, for instance, you’d file the one for the 2016-2017 tax year on July 6 2017.

Make sure you include:

– Healthcare insurance

– Company cars

– Self-assessment fees a company has paid

– Non business-related travel and entertainment expenses

– Assets given to an employee which have significant personal use

– Any payments that would normally be paid by the employee but for which you have paid

Before April 2016, you could get dispensation from HMRC to omit expenses from P11D forms.

An exemption system is now in place under which most business expenses company staff members incur personally no longer have to be recorded.

These include:

– Travel (as well as subsistence costs incurred during business travel)
– Credit cards used for work purposes
– Business entertainment expenses
– Subscriptions and fees

HMRC imposes penalties for late filings and wrong filings. If the 6th July deadline is missed, there’s a two-week penalty-free window for filing, but after 19th July, a £100 monthly penalty applies per 50 employees.

You’ll receive a reminder and details of incurred penalties if you haven’t settled by November.

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