The HM Revenue and Customs Software Developer Support Team have confirmed changes to the acceptable P11D submission due from 6th April 2023 and onwards.
Although paper forms may still be issued to relevant employees as a copy, the submission of paper forms to HMRC is no longer permitted.
In a message to software developers entitled: Subject: PAYE EXB 2022-23: Change to Amendments, the HMRC SDST has confirmed the following intention.
P11D and P11D(b) Update
Within the HMRC Employer Bulletin published 15 February 2023, we included summary information on the submission of P11D and P11D(b) returns to HMRC from 06 April 2023. The Bulletin is available at the following link: https://www.gov.uk/government/publications/employer-bulletin-february-2023/february-2023-issue-of-the-employer-bulletin#Reporting2
From 06 April 2023, HMRC is amending legislation to mandate the submission of original P11D and P11D(b) returns online either via 3rd party software or HMRC PAYE Online service. Paper print/post versions of these forms will no longer be accepted on or after this date.
From 06 April 2023, HMRC is amending legislation to mandate the electronic submission of amended P11D and P11D(b) returns. Paper print/post versions of these forms will no longer be accepted on or after this date.
Original P11D and P11D(b)
For those existing employers who already submit their original P11D and P11D(b) returns online either via 3rd party software or HMRC PAYE Online service, there is no change.
For those remaining employers who have continued to submit paper returns in previous years, from 06 April they will be required to submit their P11D and P11D(b) returns online either via 3rd party software or HMRC PAYE Online service, as they do now with other online returns they submit to HMRC. For employers who need to submit up to 500 P11D and P11D(b) returns, the free HMRC PAYE Online service can be used.
Amended P11D and P11D(b)
We will publish and mandate an electronic version of the P11D and P11D(b) form accessible via GOV.UK, which will enable employers to submit amended forms electronically from 06 April 2023.
Employers will be able to access a new electronic form within GOV.UK to submit any amended P11D and P11D(b) forms. The electronic form is not linked into the online submission route via either 3rd party or HMRC software, so no changes are required to facilitate its use.
What will happen if an employer submits a paper P11D/P11D(b) (original or amendment) from 06 April 2023? The form will be rejected on the basis that it has not be submitted in the prescribed manner. The employer will be notified of the rejection and sign-posted to the correct process.
Further external communications will be published by HMRC over the coming weeks to continue to raise awareness of this change.
Software Developer Support Team
HMRC CDIO EPS | Enterprise Integration Services
What about forms for employees?
The announcement relates to paper forms being sent to HMRC being no longer allowed. Employers are still permitted to send paper copies to employees, although many will already supply P11D information electronically in alternate formats already.
Is it time to payroll?
An alternate to P11D is to payroll benefits in kind. To do so requires formal registration with HMRC prior to the commencement of the relevant tax year that Payrolling is commencing.
For the tax year 2022/2023, it’s too late to register if not already Payrolling officially. Electronic P11D filing is required to HMRC. For the 2023/2024 tax year, registration is required at the latest 5th April 2023.
Employers would need to appropriately ready themselves for the change, although elements are very similar, Payrolling and P11D are subtly different. Payrolling is predictive in advance with amendments along the journey. whereas P11D is retrospective reporting of facts after.
So what do we do?
Employers who currently send paper P11D forms to HMRC need to urgently review their choices and apply plans for change. A number of options are available to enable employers to report P11D data electronically.
The main impact factor is the short notice for the change which impacts employers in the late stages of the first impacted tax year 2022/2023.