What is P11D Form: Key Facts and Insights
Some employers provide benefits to their employees and directors, and they need to inform HMRC about this through their payroll software or the P11D form. This is essential so they can pay the right amount of tax. If you need to learn about the P11D form, this article will explain the complete information of the P11D form and what to include in it.
- Overview of the P11D Form
- Is VAT Required for the P11D Form?
- Do I Need To Show Anything on the Form?
- Is Including VAT Mandatory on the P11D Form?
- Do I need to include VAT on a P11D form?
- How Can I Submit a P11D Form?
- What is the deadline for Submitting the P11D Form?
- Do Employees Need a Copy of the P11D Form?
Overview of the P11D Form
Businesses use the P11D form to tell HMRC about the benefits they provide to staff. These benefits involve Benefits in Kind, goods and services employers give employees for free or at a discounted rate in addition to their normal salary.
For example, a company car or a gym membership
One of the best things about the benefit in kind is to avoid taking the form of cash as it will increase the value of what employee receives from their employer. To avoid people not paying tax by taking part of their salary as a benefit instead, they are reported to HMRC and subject to tax and National Insurance. Employers can report these perks through the payroll software or by submitting a P11D form.
Is VAT Required for the P11D Form?
You must file the P11D form separately for every employee and director to whom you provide Benefits in kind unless you deduct what they owe through payroll.
One crucial factor is that it’s always the employer’s responsibility to submit a P11D form rather than the employees. However, if you have a small business where you are the sole director, you can be both!
Do I Need To Show Anything on the Form?
Yes, you have to provide the following information.
– Employers and director name
– Date of birth and National Insurance Number
– Confirm the value of benefits in kind they receive and the date
– If the tax on the benefit value has already been paid through payroll, you can include this information under the heading ‘Amount made good or from which tax deducted.
Is Including VAT Mandatory on the P11D Form?
Yes, it is mandatory. Even if you are VAT registered and can reclaim some or all the VAT paid, the P11D will require the total amount of VAT paid.
Do I need to include VAT on a P11D form?
Yes, even if you’re VAT registered and can reclaim some or all of the VAT paid, the P11D form should still include the total amount.
How Can I Submit a P11D Form?
The following are the ways you can submit your P11D form.
– By using your payroll software
– Download the P11D form and send the complete form to HMRC through the post.
– The HMRC’s PAYE online service allows 500 employees to submit to the same account you used to report other PAYE information.
Just like reporting deductions from staff wages, if you have already paid tax on employee benefits through payroll, you do not need to submit the P11D form.
Submit a P11D(b) Form
The business should also submit a P11D(b) form to inform HMRC about the amount of Class 1A National Insurance it needs to pay as an employer.
Employers must make National Insurance contributions to the value of benefits they give to employees and company directors.
Whether you deduct and pay tax on benefits through your payroll or not, you still have to submit the P11D(b) form.
What is the deadline for Submitting the P11D Form?
The deadline to submit the P11D form is 6 July, following the end of the tax year it relates to.
Example
The deadline for submitting a P11D form for the 2023/2024 tax year is 6 July 2024.
Do Employees Need a Copy of the P11D Form?
Yes, employers must give employees a copy of the form provided to HMRC about benefits of kind. If they are self-employed on the side or a company director, they will need the information for their self-assessment tax return. They can also ask HMRC for a copy of the data you submitted.