If you’re an employer and provide expenses or benefits to employees or directors, you may need to tell HM Revenue and Customs (HMRC) and pay tax and National Insurance on them. The means of reporting these details to HMRC is on a P11D or P9D form and P11D(b) form.The P11D is a statutory form required by HMRC from UK based employers detailing the cash equivalents of benefits and expenses that they have provided during the tax year to their directors, and employees earning at the rate of more than £8,500 per year (inclusive of any BIK amount). Your P11D(b) tells HMRC how much Class 1A National Insurance you need to pay on all the expenses and benefits you’ve provided.
Examples of expenses and benefits include:
• company cars
• health insurance
• travel and entertainment expenses
The deadline for reporting these details to HMRC for the tax year 2015-16 is before the 7th July 2016, so have to be received by HMRC on or before the 6th July 2016. Recent communication from HMRC's Software Developer Support Team stressed that - “Where employers fail to submit their P11D and P11D (b) returns employees may have incorrect tax codes (and tax bills) and any delays beyond 19 July might result in the employer being charged a penalty.” The charge per month is £100 for every 50 or part-batch of 50 employees provided with benefits. Per the HMRC’s CWG5 booklet Class 1A National Insurance Contributions on Benefits in Kind the filing date for the return is the 6th of July but if the return is late the penalties start to be calculated but it will only be enforced if the returns are still outstanding at 19th July. This “grace period” does not apply to the employer’s obligation to ensure that employees employed on 5 April receive their P11D / P9D by 6 July. So:
• Copy to HMRC – by 19 July at the latest
• Copy to employees – by 6 July
BrightPay can produce a P11D for sending to HMRC after year end which includes your Class 1A NICs declaration and details of the expenses and benefits provided including cash equivalents.