What is a P11D?
P11D is the return that you’re required to make if your business has made benefits or expenses payments to either directors or employees or to members of directors or employees families or households.
When is a P11D required?
A P11D is required when benefits or expenses payments have been made:
- To an employee or director who has earned £8,500 or more in the preceding year, and
- To each director who has earned less than this amount, unless they are a full-time working director with no material interest in the company or a director of a charity or non-profit making organisation.
Which expenses and benefits require P11D?
Expenses and benefits that are covered by P11D legislation typically include: living accommodation, cars, vans and fuel, interest free and low interest loans, relocation expenses and mileage allowance payments as well as passenger payments. It’s important to remember that you must complete a P11D return for payments made to all directors and employees as well as members of directors and employees families or households, unless you have a dispensation or they earn less than £8,500.
Do all expenses and benefits payments require a P11D?
Where expenses payments are made to employees and directors who earn less than £8,500, tax cannot be deducted and therefore this information should be returned on Form P9D and not P11D.
Where an employer has a P11D dispensation, they will not be required to produce these benefit-in-kind forms. When HMRC have granted a dispensation from P11D, employers no longer need to report P11D expenses and benefits and employees don’t need to note them on their personal tax return and claim the deduction for business expenses.
What are the deadlines for P11D’s?
P11D information needs to be compiled for the full tax year and returned to HMRC by 6th July after the end of the tax year.
Where can I get the forms?
You can download all the forms you’ll need right here:
Download P11D here.
Download P11D(b) here.
Download P9D here.
What happens if you get it wrong?
By its very nature, P11D legislation is complicated and the penalties for getting it wrong are severe. It’s for these reasons that it’s essential that you get this aspect of your accounting spot on.
Where to get help
On the HMRC website
All the information you could need to comply with P11D legislation is listed on the HMRC website. In recent years, HMRC has made a huge effort to make its website more user friendly and their step-by-step guide to P11D is a good example of how much they have progressed. This comprehensive but plain-speaking guide is here for you to download. The guide will take you through the whole P11D process and will show you how to report your information online, even if you’re not yet involved in reporting your PAYE in real time.
From your accountant
If you’ve worked your way through the HMRC website and feel as if you’re still in the dark, your accountant should be able to help you get your P11D right first time.
That said, if you don’t have an accountant or you feel as if you’re not getting the support you need, we’re here for you. We’d be delighted to steer you in the right direction and help make sure your P11D responsibilities are met on time and with the accuracy that will help you avoid penalties and problems.