Form P11D is used by employers to make an annual report of taxable expenses or benefits provided to employees, where the amounts were not payrolled. Class 1A national insurance contributions due on employee benefits are reported on form P11D(b). A P11D(b) can be required even if the benefits are payrolled.
From 6 April 2023, forms P11D and P11D(b) must be submitted online only. This includes lists. Employers and agents can do this using HMRC’s PAYE online service for entities with up to 500 employees, or through commercial software.
HMRC has legislated to mandate the submission of original P11D and P11D(b) returns online through one of the following methods:
The free HMRC PAYE online services can be used for employers or agents who need to submit up to 500 forms P11D and P11D(b). For more than 500 forms, third party software is required. This change was not expected. It was slipped into an article on payrolling of benefits in kind in the February 2023 Employer Bulletin, with more detail in March 2023 Agent Update issue 106.
Amendments to forms P11D and P11D(b) must also be electronic
HMRC is also legislating to mandate the electronic submission of amended P11D and P11D(b) returns from 6 April 2023.
Currently, employers or agents submit amended forms P11D or P11D(b) to HMRC using paper returns. From 6 April 2023, HMRC will no longer accept paper amended forms P11D and P11D(b); this also includes lists.
HMRC intends to publish electronic versions of forms P11D and P11D(b) forms on gov.uk to enable employers and agents to submit amended forms electronically from 6 April 2023.
More information on this will be available in the April editions of Employer Bulletin and Agent Update. No software changes are required, as this electronic form is not part of current online services.
Paper P11D and P11D(b) (original or amendment) forms submitted from 6 April 2023 will be rejected
An original or amendment paper form P11D or P11D(b) submitted by employers or agents from 6 April 2023 will be rejected on the basis that the form has not been submitted to HMRC in the prescribed manner.
The employer or agent will be notified of the rejection and signposted to the correct process.
The regulations provide that failing to comply with this new requirement to use an approved method of electronic communication will not give rise to a penalty.
Find out more in the Tax Faculty’s Payroll & Reward update 2023 on 16 May. Book here.
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