As an employer, you can choose one of two ways to report taxable employee benefits in kind. You can either report details of perks after the end of the tax year in which you use a form P11D or you can ad the value of benefits to your employees’ salaries, which is known as payrolling.

In January 2024 HMRC announced that from 6 April 2026 payrolling will be mandatory. HMRC suggests that this will make things simpler for all employers and employees. However, predictions within the industry suggest there will be exceptions and that P11D’s or a new equivalent might still be necessary in some circumstances.

As of February 2024 there are no details how the move to compulsory payrolling will be achieved. HMRC says that it will consult with the tax industry and then publish draft legislation.

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For further guidance

https://www.gov.uk/guidance/paying-your-employees-expenses-and-benefits-through-your-payroll