End of the P11D

By December 10, 2014Uncategorized

Although it seems very unlikely the P11D will be scrapped any time soon –

 

“From April 2016, the government will remove the £8,500 threshold below which employees do not pay Income Tax on certain benefits in kindand replace it with new exemptions for carers and for ministers of religion. It will also exempt certain reimbursed expenses and introduce a statutory framework for voluntary payrolling“
extract from the Tax simplification section of the Autumn Statement

 

This means that some benefits are likely to be able to be spread through the year via PAYE rather than reported on a P11D. The full details are not available yet, but this should be good news for employers.

 

The aim is to offer a reduction in administrative time to employers, and therefore a cost saving, whilst at the same time making it more straightforward and accurate for employees. Employees will be able to spread the correct amount of income tax on their benefits throughout the year.

 

There is a fair amount of discussion on the payroll forums but we do not have full details yet, and we are just waiting to see the complexity that will be passed across to payroll. There have already been questions raised regarding how class 1A and 1B NICs will be recorded. Watch this space!