What is a P11D?

(3 minutes to read)

A P11D is a form that needs to be sent off on an annual basis, a P11D will be filled out by limited company contractors and is used to report employee benefits.

With the numerous benefits associated with being self-employed, this method of working does come with additional responsibility compared to a contractor’s permanent counterparts, including being aware of certain forms and legal requirements.

As a limited company contractor, you will need to fill out and send off a number of different forms to HMRC, one of which is called a P11D.

What is a P11D and why does my company need to file one?

Any company who provides their staff with taxable benefits, will need to ensure that they have filled out and sent off a P11D form; which is used to report those benefits to HMRC.

You must also include any benefits or facilities provided to members of the director’s or employee’s family or household.

The government explains that for most purposes ‘‘family or household’ is defined as the employee’s spouse or civil partner, sons and daughters and their spouses or civil partners, his or her parents, servants, dependants, and guests.’

You may not need to complete a P11D if there are no taxable benefits or if the benefits have been taxed through the payroll.

By sending off this information, you are notifying HMRC of any tax or National Insurance Contributions that the company may need to pay on benefits – otherwise known as benefits in kind.

Typical benefits in kind that you would include on a P11D include:

  • Any private healthcare provided
  • Health insurance
  • A company car
  • Life insurance
  • Personal use of a company asset, such as a computer

When do I need to submit my P11D form and how long do I have to pay?

You will need to submit your completed P11D form by 6th July and any amount that you owe must be paid by 19th July.

There will be penalties for missing the deadline – a fine of £100 per 50 employees will be issued for each month or part month that your form is late and you will also be charged penalties and interest if you are late with the payment.

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Changes to be aware of

There have been a few recent changes made to the P11D form, these include:

  • An end to the £8,500 threshold for taxing certain benefits in kind

Previously, you would have only needed to provide information for expenses and benefits in kind offered to either employees or directors earning a rate of £8,500 or more per year, or directors earning a rate less than £8,500 a year (unless a full-time working director with no material interest in the company or a director of a charity or non-profit making firm).

This has now completely changed with regards to the threshold being lifted for taxing certain expenses and benefits, meaning that it now applies to all employees, no matter what their level of income.

  • Voluntary ‘payrolling’ of benefits in kind

A new framework means that employers are able to deduct the tax that is due from benefits in kind through their payroll instead of using an employee’s tax code.

The types of benefits in kind allowable for this different process include cars, car fuel, private medical insurance and certain subscriptions, such as gym memberships.

If an employer wishes to use voluntary ‘payrolling’, they will need to make HMRC aware of their intentions beforehand.

To find out more about contracting please call us on 01442 795 100 or email jaime.thorpe@dolanaccountancy.com.

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Why Dolan Accountancy?

Dolan Accountancy was set up by Simon J Dolan, the man behind the well-known brand SJD Accountancy. With over 25 years experience in the contracting marketing, Dolan Accountancy has the heritage, reputation and credibility you can trust. Working closely with our sister company, Contractor Umbrella, it means we can offer one low cost, fixed fee package at £105 + VAT per month. This gives you the flexibility of using both our Limited Company Accountancy Services and our award winning Umbrella Service, for one inclusive cost. We don’t believe in tiered packages or hidden extra fees, instead we aim to give you everything you need, including:

  • Free Company Formation – This is where it all begins. Once you have decided on an available name, we will form your company free of charge (if using our accountancy services) and it will be ready for you to use in as little as three hours.
  • Free use of Contractor Umbrella – With changes in Public Sector IR35 Legislation we understand that sometimes you are required to contract via an umbrella company. We will keep your limited company ticking over, while you work margin free via our sister company, Contractor Umbrella.
  • A Dedicated Accountant – Your accountant will be there for any company or personal tax advice that you require. We will never outsource work, even to internal teams.
  • Free Access to FreeAgent – The founder behind the multi award winning FreeAgent platform was one of Simon’s first clients, therefore it only seems fitting that we offer all of our clients access to FreeAgent, free of charge.
  • Free Business Banking – We have decided to waive our commission so our clients can use Tide free of charge for the first year.
  • Unlimited IR35 Status Reviews – We will review all of your contracts for IR35 purposes and provide you with our professional opinion as to its status.
  • Free Registered and Director’s Service Office Address – Sometimes you just don’t want your home address on display at Companies House. When you sign up to our accountancy services, we will offer the use of our address as an alternative.
  • Your Business and Personal Taxation Needs – This includes Company Accounts, Director’s Personal Tax Return, VAT Returns, Payroll, Corporation Tax and Dividend advice, to name just a few.
  • Same day payments- We offer same day payments as standard providing funds are received into our account by 9am, for no additional fee.

If you’d like to find out more about how Dolan Accountancy can help you and your business, please give us a call on 01442 795100 or email sophie.lewis@dolanaccountancy.com or jaime.thorpe@dolanaccountancy.com.