If you provide employees or directors with benefits in addition to salary, these may need to be reported to HMRC on a P11D.
What is a P11D?
A P11D return is used to report taxable benefits and expenses provided outside payroll. These benefits can create a tax charge for the employee and Class 1A National Insurance charge for the employer.
Common examples include company cars, private medical insurance, loans, and accommodation.
Key Deadlines
For the tax year ending 5 April the key deadlines are:
- 6 July – Submit P11Ds to HMRC and provide copies to employees
- 6 July – Submit P11D(b)
- 22 July – Pay Class 1A NIC electronically (19 July by post)
What is the NI Charge?
In most cases, employers pay Class 1A National Insurance most taxable benefits reported on the P11D return. For the 2025/26 tax year, the rate is 15% of the taxable value of the benefit.
Common Benefits
| Benefit | Reportable on P11D |
| Company car | Yes |
| Private medical insurance | Yes |
| Beneficial loans | Yes |
| Living accommodation | Yes |
| Non-cash vouchers | Usually |
| One mobile phone | Often exempt |
| Trivial benefits (e.g. Easter eggs, birthday flowers or a meal out which is less than £50 a head) | Often exempt |
Penalties
Failure to file your P11D on time will result in late filing penalties and interest of:
- £100 per 50 employees/directors for each month or part month a P11D(b) is late
- Interest charged on late paid Class 1A NIC
- Penalties of up to 30% of the extra tax due for careless inaccuracies where HMRC deem the error to be due to careless inaccuracies
- Higher penalties for deliberate errors or failure to notify
Example:
Y Limited is an SME that provided taxable benefits to 15 employees and directors during the tax year. The benefits included:
- Company cars
- Fuel benefit and
- Private medical insurance
Y Limited is required to submit:
- P11D forms for each employee/director receiving the taxable benefits in the year
- A P11D(b) to report the total Class 1A NIC due to HMRC
Due to an internal oversight, the P11D(b) was filed 3 months late. The impact of the late filing is:
- HMRC may charge penalties of £100 per month for every 50 employees included within the return, until the return is filed.
- As Y Limited had 15 employees/directors receiving taxable benefits, it falls within the first 50-employee band.
- This 3-month delay may result in a late filing penalty of £300 for Y Limited, calculated as £100 x 3 months
In addition, Y Limited had calculated £2,000 of Class 1A NIC as due, which was not paid by the payment deadline. The impact of late payment is:
- As the £2,000 of Class 1A NIC remained unpaid more than 30 days after the payment deadline, HMRC could charge a late payment penalty of 5%, being £100.
- Interest would be charged on the late-paid amount (currently at 7.75%).
- Further 5% penalties could apply if the Class 1A NIC remained unpaid 6 months and 12 months after the due date.
How We Can Help
We can assist with reviewing benefits provided, preparing P11Ds and P11D(b), calculating Class 1A NIC, advising on exemptions, resolving HMRC queries and forecasting calculations should you be considering providing benefits in the future.
If you need support with your P11D obligations, please contact our team at [email protected].
