End of year procedures to be followed by employer and employee (480: Chapter 24)
Use these procedures if you’re an employer or an employee and need to report end-of-year expenses and benefits.
Employer
24.1
SI 2682 2003 (Regulation 85)
At the end of each tax year the employer needs to give particulars of the non-exempt payments, benefits and facilities given for each of their employees. Form P11D given by HMRC is used for the purpose. If the employer is registered to payroll benefits through Real Time Information (RTI) the taxable amounts will be reported in a full payment submission.
24.2
A person providing benefits for the employees of another will also need to submit information for the individuals for whom they have given benefits.
24.3
Where an employer has a number of employees within the scope of the special rules mentioned in this guide but to whom they have not paid any expenses or given any benefits, the employer does not need to complete separate forms P11D for these individuals.
24.4
The individual forms P11D for those employees who have had expenses and benefits, together with any form P11D(b), ‘Return of Class 1A National Insurance contributions’ certifying that all the required forms P11D have been sent, should be submitted to HMRC by 6 July each year. More information is given in form P11D (Guide) which is available from the Employer Orderline.
24.5
Employers also need to give, for each employee for whom a form P11D is due, a statement of the information shown on the employee’s form. The statement should be given by 6 July. If the employer has registered to payroll benefits, the employer should make sure that payslips or a statement sets out the amounts which have been taxed through PAYE deductions.
Employee
24.6
An employee needs to include any non-exempt expenses payments and the taxable value of any benefits given to them, and members of their family or household, in an annual tax return. In general the gross amounts are to be shown even though a deduction is claimed under the expenses rule described in chapter 7. Where a net benefit figure has been agreed with HMRC it’s sufficient to enter the net figure in the return.
Where an expense is covered by the expenses exemption (see chapter 2) the payments or the cost of benefits covered by the exemption should not be included.
24.7
Where you’re unable to agree with us whether an item is taxable or whether relief is due under the Employment Income expenses rule (see chapter 7), you’ll need to make a Self Assessment tax return if you do not already do so. If we do not agree with the figures you use in your tax return we’ll make an amendment to your self-assessment. You may then appeal against our amendment.
24.8
If you want to appeal against the amendment to your self-assessment you should write to HMRC within 30 days of the amendment, giving your reasons why you disagree with the amendment, sending any further information that you want HMRC to consider as well. You can also ask for payment of all or part of the tax in dispute to be postponed until the matter is resolved.
We’ll consider any further information you send us and try to reach agreement with you. If we cannot agree, you can either:
- ask for the amendment to be reviewed by an HMRC officer not previously involved in the matter
- notify your appeal to an independent tribunal
If you opt for a review you can still notify your appeal to the tribunal after the review has finished.
24.9
Find out more information about appeals and reviews.
You can find out more about tribunals on the Tribunals Service website, or you can phone them on 0300 123 1024.