What you need to know about the P11D deadline

completing p11d forms

When is the P11D deadline?

With the annual P11D submission deadline approaching on 6th July 2017, the forms, which report the details of expenses and benefits to directors and employees for the tax year 5th April 2017 are due.

As this process of gathering all the necessary information can take a while, it’s important you get started now if you haven’t already.

What is the P11D?

Employees pay tax on benefits provided as shown on the P11D, generally via a self-assessment system or a PAYE coding notice adjustment. Significant changes were introduced to the rules for reporting expenses, as of 6 April 2016. These changes include an exemption system, where the majority of business expenses incurred personally by a company employee no longer need to be recorded on a P11D. These can be:

  • Credit cards used for business purposes;
  • Business entertainment expenses;
  • Fees and subscriptions.
  • Travel (including subsistence costs associated business travel);

Regardless of whether the benefits are being reported via payroll or P11D, the employer has to pay Class 1A National Insurance Contributions at 13.8% for the provision of most benefits. The calculation of this liability is detailed on the P11D(b) form.

Class 1A NIC Deadline

The deadline for payment of the Class 1A NICs is on the 19th July (or 22nd for cleared electronic payment). As the 22nd July is a Saturday, it is probably a wise decision to ensure cleared payment is made by Friday 21st. Make sure you look at the expenses and benefits toolkit that HMRC provide. This consists of a checklist which can be used for employers to check if they are filling in the forms

What are the penalties for missing the P11d deadline?

There are significant penalties for incorrect forms or non-submission. The Government website states “You will receive a penalty of £100 per 50 employees for each month or part month your P11D(b) is late, and charged penalties and interest if you’re late paying HMRC”.

PAYE compliance is becoming more complex, and it is an area that HMRC view as a target for generating additional revenue, both in taxes and, more importantly, penalties.  Consequently, all employers should ensure that their systems and procedures are robust, and would stand up to inspection.

Areas of common mistake include the treatment of, pool cars, company vehicles and the provision of benefits for staff. Failure to declare payments made to staff for travel, subsistence and entertaining expenses often occurs where there is no private use, yet a dispensation has not been requested and obtained.  

Accountants for P11D in Manchester

If you would like any help with the completion of the forms or the calculation of the associated Class 1A NIC to ensure you meet the P11D deadline, please do not hesitate with our friendly team of experts here at Alexander & Co.