HM Revenue and Customs has informed employers as part of the February 2023 Employer Bulletin of changes to reporting benefits.
Reporting expenses and benefits for the tax year ending 5th April 2023
From 6th April 2023 HMRC will no longer accept new informal payrolling benefits arrangements.
For those employers who have informal payrolling in place:
- Employers must register now to payroll your expenses and benefits for 2023 to 2024
- if an employer already has an informal agreement with HMRC to payroll benefits for 2022 to 2023 tax year they can continue to submit P11Ds marked ‘Payrolled’
- Employers must formalise this agreement as soon as possible
For those employers who are yet to payroll expenses and benefits:
- register now to payroll your benefits from 6th April 2023
- you will no longer need to submit a P11D for each employee for whom you payroll benefits, payrolling will be quicker and easier
For those employers payrolling benefits in kind:
You may still have a Class 1A National Insurance contributions (NICs) liability and you’ll still need to send a P11D(b) to tell us how much employer Class 1A National Insurance contributions you owe. You’ll also need to send a P11D to show any benefits you paid that you did not payroll. Instead of giving your employees a P11D, you need to give them a letter explaining what you’ve payrolled.
More information on taxing your employees’ benefits and expenses through your payroll is available.
For those employers who do not yet payroll benefits in kind:
The deadline for reporting any P11D expenses and benefits in kind you provided in 2022 to 2023 tax year, is 6th July 2023.
Reporting expenses and benefits for 2022 to 2023 tax year:
If you’ve paid benefits in kind to any employees you must send a P11D and a P11D(b) to HMRC no later than 6th July 2023, or you may get a penalty. HMRC charge penalties on a monthly basis and issue penalty notices each quarter, until you file your return.
From 6th April 2023 all P11D and P11D(b) must be reported online
For the 2022 to 2023 reporting year HMRC will no longer accept paper P11D and P11D(b) forms, this includes lists.
They recommend employers file using one of the following methods:
HMRC’s PAYE Online service is free and will allow submissions of up to 500 employees.
To help employers submit online, employers will be able to register for the ‘Submitting forms P11D and P11D(b) online’ webinar.
This will be live in May, June and July 2023. The recording will also be uploaded to the HMRC webinar page.
To register for PAYE webinars, go to guidance for HMRC email updates, videos and webinars for employing people.
If an employer makes a mistake and needs to submit an amendment
From 6th April 2023 HMRC will no longer accept any paper amendments. Instead, they will launch a new online submission link to submit amended P11D and P11D(b). More information on how to use this will be available in the April edition of the Employer Bulletin.
Further information on expenses and benefits for employers is available.
With hints in prior bulletins on the use of informal payrolling arrangements potentially ending, now with little to no notice the HMRC have ended the option for new informal arrangements and require all prior informal arrangement to be formalised for the 2023/2024 tax year.
Also use of paper based documents is ending as new electronic submission compulsion is introduced.
Employers are going to have to review their arrangements and plan for change now!