Reporting employee expenses

Jun 15, 2022

It is time to report the expenses and benefits provided to employees during the year to 5 April 2022. This reporting process is known as the P11D after the number of the relevant HMRC form although these days the report is normally a function within payroll software.

HMRC has been discouraging people from using paper P11D forms for some time and in recent years it has provided an interactive PDF for employers to submit the information online. However, in 2020 this reporting method created a number of problems, and it has since been scrapped.

This year you have three options to complete the P11D report by the deadline of 6 July 2022:

  • HMRC’s PAYE online for employer’s service (for up to 500 employees);
  • commercial payroll software; or
  • the paper P11D form.

We do not recommend option 3 as paper forms can easily get lost in the HMRC system. We can help you with P11D reporting which can be a hassle.

It may be worthwhile ‘payrolling’ any regular employee benefits such as health insurance or cars. This would mean adding the cash equivalent of the benefit to the employee’s pay and the employee will be charged income tax but not NIC on that amount. As the employer you pay Class 1A NIC on the value of the benefit after the end of the tax year.

In order to payroll any benefits you need to apply to HMRC online in advance of the start of the tax year for which payrolling is to apply. We can help you with that – contact a member of our team.

Other Tax Briefing – Summer 2022 articles

Trivial benefits for directors and family

Tax implications of Homes for Ukraine

Beware of tax scams

Using your personal tax account

Cost of living support

Car or van questions

Preparing for MTD for income tax

Changing NIC in July