Payrolling – tax employees’ benefits through your payroll

Dear @PAYadvice,

We’re continuing to help employers, businesses and individuals with online support during this difficult period.

Almost all benefits in kind can now be payrolled to save you time – which means no more forms P11D. Find out more in the following live webinar – during which you can ask questions using the on-screen text box.

Payrolling – tax employees’ benefits through your payroll: If you want to payroll benefits during the 2021-22 tax year, you can register right up to 5‌‌ April 2021. We’ll explain how to register, what advantages there are and give examples of how to deal with some of the most common benefits.

PAYE is easier, with help from HMRC.

Yours sincerelyalison walsh signature

Alison Walsh

Head of Digital Communication Services

PAYadvice Opinion

Payrolling benefits is more simple than may be thought. It makes the collection of tax right in real time.

The P11D brings an uncertainty bounce shock, especially for new starters or for one off benefits reported on form P11D now. Due to its annual reporting nature, employees can be hit with a three year liability. The tax on benefits from the last years and forward taxation for the current. This can be prevented by payrolling benefits in kind.

So why not consider payrolling from April 2021. Registration needs to happen by the latest 5th April else you are too late and will end up waiting another year. Give your employees certain and avoid taxation shock!

Many payroll solutions have capability present, and with affordable payroll solution options and maybe buying a little expertise, you can save both yourself and your employees some reporting hassles.

You will need to consider adding pay elements to enable the tax calculation, generally there is no NIC in payroll, although there may be Class 1A NIC liabilities on the employer that need to be accounted on the single form P11Db as an adjustment value.

If you are considering for April 2021, you need to consider acting and preparing soon. if you need help, PAYadvice can help.

PAYadvice.UK 3/9/2020 updated 23/12/2020

Leave a Reply