What to Report on P11D Forms

Introduction

If you provide benefits or pay expenses to your employees or directors, you may need to report these to HMRC using form P11D. This form captures taxable benefits and expenses that haven't been payrolled, helping HMRC calculate the correct tax and National Insurance due. Understanding what to report, when to file, and how to complete P11D forms correctly will help you avoid penalties and stay compliant.

What is a P11D Form?

A P11D is a form you must complete for each employee or director who receives expenses or benefits that aren't exempt from tax. These forms tell HMRC about the taxable value of benefits and expenses provided through employment.

You need to submit a separate P11D for each employee who receives reportable benefits or expenses. You must also complete a P11D(b) form, which calculates the Class 1A National Insurance contributions you owe on these benefits.

What Benefits and Expenses to Report

You must report all non-exempt expenses payments and benefits provided to employees, whether paid:

Directly to the employee
To a third party (including credit card companies)
To the employee's spouse, family, or household member (these must be treated as though given to the employee personally)

The amount you report should include the full VAT paid, even if you can reclaim some or all of the VAT from HMRC.

When reporting the use of assets, you must show the gross figure with no deduction for expenses.

Items That Must Be Reported

You should include expenses payments from which tax has already been deducted under PAYE. Entertainment expenses must be shown on P11D forms at their full value, even if these expenses are disallowed when calculating your business tax liability.

Subscriptions that must be reported include:

Initial and annual subscriptions to clubs catering for leisure or sporting activities
Subscriptions to societies where the expense is borne by or on behalf of the employee
Professional and learned society subscriptions related to employment

Items You Don't Need to Report

You don't need to include:

Items covered by an exemption
Items covered by a PAYE Settlement Agreement
Benefits or expenses you've registered to payroll and reported through Real Time Information (RTI)
Initial and annual subscriptions relating to credit cards provided for an employee (these are exempt)

Check the HMRC Expenses and Benefits A to Z guide to confirm which benefits require reporting and which are exempt.

When You Don't Need to Complete P11D Forms

You don't need to submit P11D forms if you have:

Registered to payroll benefits, expenses, or both
Deducted tax under PAYE and sent these details through Real Time Information (RTI)

Even if you payroll benefits, you still need to pay Class 1A National Insurance contributions on them and complete form P11D(b).

Filing Deadlines

From 6 April 2023, you must file expenses and benefits returns online unless you're digitally exempt. If you think you may qualify for digital exemption, contact the employers' helpline on 0300 200 3200.

You must submit your P11D and P11D(b) forms at the same time.

Class 1A National Insurance Contributions

You must pay Class 1A National Insurance contributions on most benefits. The deadline for payment is:

19 July after the end of the tax year if paying by post or cash
22 July after the end of the tax year if paying electronically

If you pay late or don't pay enough, HMRC will charge interest on the outstanding amount after 19 July.

How to File P11D Forms

You can file P11D forms electronically using:

HMRC's PAYE Online service
Commercial payroll software

Before filing, you must enrol with HMRC to use the PAYE Online filing service through the Government Gateway. The online service that was previously available for small to medium-sized employers (up to 150 employees) was withdrawn in April 2021.

MARORS Reporting

The Mileage Allowance Relief Optional Reporting Scheme (MARORS) is the only P11D information you can still submit as a list, as it cannot be filed online.

Your MARORS list must be:

Easy to read
In Arial font size 11 or larger
In alphabetical order by employee's surname
Include each employee's name, gender, and National Insurance number or date of birth

Send the MARORS list with a covering letter to:

HM Revenue and Customs

BX9 1WE

Penalties for Non-Compliance

Failing to submit P11D forms on time can result in:

A penalty of up to £300
A further penalty of up to £60 per day if the failure continues

If you're registered to payroll benefits but don't report them through RTI, you'll face penalties for failure to report on or before the payment was made.

Making an incorrect return on form P11D carries a maximum penalty of £3,000 per form.

Sources

This article provides general guidance based on current HMRC rules. For advice specific to your situation, speak to your accountant.