P11D
In this article we will be looking at P11Ds, what they are, what they mean for your business and the deadlines that you need to be aware of.
What is a P11D
When an employer provides certain benefits to its employees, these benefits are taxable on the employee.
A P11D is a tax form which an employer must send to HMRC. The form lists all of the Benefits In Kind (BIK) that the employer has provided to its employees.
Most of these benefits are non-cash benefits.
A separate P11D must be prepared and submitted for each employee which has received a taxable BIK from the employer.
Form P11D will detail the type of benefit that each employee has received as well as the cash equivalent for each benefit.
This form then provides HMRC with the information required to calculate the employees tax liability. Usually, HMRC will then adjust the employees tax code in order to collect the additional taxes.
Why you must submit a P11D
Most types of benefits that an employer provides to its employees are taxable on the employee.
However, as most of these benefits are non-cash benefits, often tax is not collected when the benefit is provided.
Also, as most of the benefits are non-cash, they often are not included in the payroll. As such, HMRC will often not be aware of these benefits until a P11D is submitted.
HMRC can apply penalties for late P11Ds or in instance where the employer fails to submit a P11D.
Most common type of benefits
There are many types of taxable benefits which an employer may provide its employees. However, a few of the most common commanders include
- Company car benefit
- Company car fuel benefit
- Company van benefit
- Private medical insurance benefit
- Accommodation benefit
- Gym membership benefit
- Employer loan benefit
It is important to note that a workplace pension is not a taxable benefit for the employee. As a result, workplace pensions should not be included on the P11D submission.
What is a P11Db
When an employer provides certain benefits to its employees, these benefits are taxable on the employee. However, the employer must also pay class 1A National Insurance Contributions (NIC) on these benefits as well.
A P11D lists the benefits provided to a certain employee and the cash value of those benefits. Whereas, a P11Db simply lists the total value of benefits provided by the employer and the employer class 1A NIC payable.
This is a separate form which must be submitted to HMRC in addition to any P11Ds.
Deadlines
The deadline for submitting your employees P11Ds and the employers P11Db is 06 July following the end of the tax year.
For example, the tax year ended 05 April 2023, the deadline for submitting both P11D & P11Db is 06 July 2023.
Payment of employers class 1A NIC is payable to HMRC by 22 July 2023 if paying electronically.
We hope that you have found this article useful. If you have any queries about P11Ds or need help with yours, please do get in touch.