What is a P11D?
The P11D form is used to report benefits in kind. These are items or services which you (or your employees) receive from your company in addition to your salary.
Examples of expenses and benefits include:
- company cars and/or fuel
- company vans and/or fuel
- health insurance
- travel and entertainment expenses
- childcare
- low or interest free loans
- telephones and mobile phones unless the contracts are in the company’s name
Benefits in kind effectively increase your salary, so you may need to pay National Insurance contributions on them.
What information do I need?
HMRC may ask to see evidence of how you accounted for each expense or benefit at the end of the tax year. Therefore you must keep a record of all expenses and benefits you provide to your employees. So for example, if you reimburse an employee’s travel expenses you will need to keep a record of when and why the employee travelled. Where possible also keep receipts as evidence. Your records need to be up to date and accurate.
N.B. You don’t need to submit a P11D form for an employee if you’re paying tax on all their benefits through your payroll.
DON’T FORGET… Records must be kept for 3 years from the end of the tax year they relate to.
When is the deadline and what happens if I miss it?
P11D’s are completed by the employer not the employee and must be filed by 6th July (this covers April 2020-April 2021). As always, HMRC are at the ready with fines and penalties should you file late or incorrectly. If you miss the 6th July deadline there is a 2 week grace period. However, if the 19th July rolls around and your P11D has not been filed you will incur fines of £100 per month or part month!
But wait… there’s more!
In addition, it may be necessary to inform HMRC of any share movements relating to your company during the year to 5 April 2021.
Basically, if any employees, directors or the family of directors of a company have acquired, sold or transferred any shares in that company, then Form 42 may have to be filed. The deadline for submitting this form to HMRC is also 6th July 2021.
So, if you have any questions or would like help with your P11D just let us know! Drop us an e-mail at advice@cedarandco.co.uk or give us a call on 01332 292022, we’d love to help!