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Time is running out for business owners to submit P11D forms. Each year, these forms – which report employees’ benefits in kind – need submitting to HMRC by 6 July.

As with many tax deadlines, it can be easy to be distracted so you lose track of time. But missing a HMRC deadline can result in penalties, and it’s no different for P11D forms.What are P11D forms?

A P11D form is used, as we have mentioned, to report benefits in kind. Benefits in kind are items and services which employees (including you) receive from your company in addition to their salary. This could include private healthcare or company cars. The annual P11D form reports such items to HMRC and on your annual self-assessment return.

Benefits in kind effectively increase your salary, so there could be National Insurance contributions (NICs) added. These costs are picked up by the company, not the individual who is benefiting.

When do I need to submit my P11D?

P11D filings aren’t related to your company’s financial year and must all be filed by 6 July following the tax year in question. So, your P11D for the April 2020-April 2021 tax year must be submitted by July 6, 2021.

Who completes a P11D form?

It is the employer’s responsibility to file P11Ds with HMRC.

What benefits must be filed?

Any employee benefits which are paid for by the company must be included on the P11D form. Typical examples could include:

  • Company cars
  • Loans for rail season tickets
  • Other loans or financial benefits
  • Private health insurance
  • Staff entertainment including social events
  • Reward schemes with non-cash rewards
  • Self-assessment accountancy fees
  • Non-business travel or entertainment expenses
  • Any goods or assets with personal use.

What if I don’t file on time?

\If you miss the 6 July 6, your company can receive a penalty of £100 per month per 50 employees.

Be careful when you you file your P11D because if it is inaccurate, you can also receive penalties. Genuine mistakes are unlikely to be punished, but penalties of 30, 70 or 100% of the owed tax can be enforced if HMRC finds evidence of deliberate attempts to conceal tax liabilities. If you still haven’t filed by November, HMRC will send you a reminder, along with details of all the penalties you’ve accrued up until then.

Common mistakes

There are some mistakes or misunderstandings often made in relation to P11D forms. As a director, you don’t need to pay interest on the money you owe to the company – as long as the director’s loan is less than £10,000. The overdrawn amount, effectively a loan from the business to the director, is treated as an employment-related benefit and must be included on the relevant director’s P11d form.

Meanwhile, the cost of calls made by employees from their home telephone or personal mobile where the company has repaid the expense can be overlooked.

If you need help with P11D or other tax issues, please contact us today and speak to our team.