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Form P11D is used to inform HMRC about benefits provided to employees throughout the tax year, outside of payroll, and pay tax and national insurance contributions on them.

The deadline for submitting the P11D is 6 July following the end of the tax year, and the deadline for payment of Class 1A National Insurance is 19 July.

The tax payable on benefits is suffered by the employee, usually by HMRC changing their tax code after the form is submitted. Class 1A National Insurance is paid by the employer at a rate of 13.8% for any benefits provided.

If you do not want the employee to suffer the tax please refer to our PAYE Settlement Agreements Quick Guide.

Common benefits reportable on a P11D include:

  • Company cars where there is an element of private use (including a regular commute);
  • Healthcare and other forms of insurance such as dental;
  • Company mobile phones and internet where there is private use;
  • Low interest or interest-free loans in excess of £10,000 provided toemployees;
  • Some provisions of childcare to employees;
  • Gym memberships provided to employees;
  • Accommodation provided to employees.

Statutory exemptions:

Items that are commonly covered by statutory exemption are:

  • Travel, including subsistence costs associated with business travel and travel to a temporary workplace
  • Accommodation linked only to business travel
  • Detached duty relief (see below for more information).
  • Fuel for business mileage in a company car
  • Hire cars and related fuel costs if used for business purposes
  • Business entertainment expenses
  • Credit cards used for business and in the business’ name
  • Fees and subscriptions paid to professional bodies if they are approved by HMRC
  • Mobile phones in the company’s name (see flow chart)
  • Business line rental at employees home
  • Uniform and tools for work
  • Sundry business expenses, such as office supplies and stationery
  • Trivial benefits (see below for more information)

Detached duty relief, where the expected period of secondment is less than 24 months, is covered by the statutory exemption as there is no liability to income taxes. As soon as this expectation changes to over 24 months the whole reimbursed expense amount becomes taxable.

The statutory exemption does not apply to expenses or benefits that are paid for or provided under a salary sacrifice.

You do not need to apply for an exemption if you’re paying HMRC’s benchmark rates for allowable expenses. If you pay above HMRC’s benchmark rates please let us know.

The following link sets out agreed rates of reimbursement and contains other useful information: https://www.gov.uk/expenses-and-benefitsa-to-z

Trivial benefits are statutory exemptions if the following conditions are satisfied:

Cost of providing the benefit does not exceed £50 per employee (for OMB’s over £300 in total per tax year).

Benefit is not cash or a cash voucher

The employee is not entitled to the benefit as part of any contractual obligation

The benefit is not provided in recognition of particular services performed by the employee as part of their employment duties.

Mobile phones

If you have any queries regarding statutory exemptions, please email on P11D@ouryclark.com.

TAX 14 Disclaimer: This note does not contain a full statement of the law and it does not constitute legal advice. Please seek legal advice if you have any questions about the information set out above.

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