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P11D Payrolling Benefits For Employees

Easier than changing tax codes ...


Posted by Roger Eddowes on 14/02/2022 @ 8:00AM

A question that comes up from time to time is about payrolling benefits. Form P11D is usually submitted as an end-of-year report to HMRC for each employee that has been provided with benefits not included in their wages ...

It's better to payroll benefits rather than change tax codes every year!

It's better to payroll benefits rather than change tax codes every year!

copyright: kurhan / 123rf

The usual deadline for submitting P11Ds is the 6th of July following the end of the current tax year. You should provide your employees with the P11D and inform HMRC of the total Class 1A National Insurance you owe using for P11D(b).

"Is there any way to make taxable benefits to employees easier?"

Yes, you can now payroll benefits to your employees, though you must register with HMRC before the start of the tax year you wish to payroll benefits in. You can find out more about this by clicking here.

Whenever you payroll benefits, you add in the cash equivalent of the benefit to your employees onto their taxable pay then simply tax them through your payroll system in real-time.

If you choose to payroll benefits then you no longer need to produce P11Ds for your employees, but will still have to calculate Class 1A National Insurance on P11D(b) by the 6th of July following the end of the tax year you payrolled the benefits.

I feel that it is beneficial to employees that tax on benefits is collected through the payroll in real-time rather than having their tax code adjusted in the following year.

But do find out if this is suitable for your business beforehand.

Until next time ...

Business Godparent


Would you like to know more?

If anything I've written in this blog post resonates with you and you'd like to discover more about payrolling benefits for your employees, it may be a great idea to give me a call on 01908 774320 and let's see how I can help you.

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About Roger Eddowes ...


Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.

Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.