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Agents can register to payroll client’s benefits-in-kind

Author: ICAEW Insights

Published: 02 May 2024

It is now possible for agents to register with HMRC for benefits-in-kind (BIK) to be taxed through their client's payroll for 2025/26 onwards.

HMRC has developed a new service for agents to register employment benefits which will be taxed through their client's payroll in 2025/26 onwards. To access this service, the agent must opt in to use the employer liabilities and payments service.  

The deadline for an employer to register with HMRC to payroll BIK for 2025/26 is 22:00 on 5 April 2025. It is now too late to register to payroll benefits for 2024/25. 

At present, employers have the option of reporting most BIK and accounting for the income tax due via payroll. This removes the need for employers to submit forms P11D for the BIK being payrolled. However, class 1A national insurance contributions (NIC) still have to be accounted for using form P11D(b).  

HMRC has announced that the payrolling of BIK will be mandatory for 2026/27 onwards. This will include accounting in-year for class 1A NIC. However, there are many details that need to be resolved before go-live and ICAEW’s Tax Faculty is working closely with HMRC to try to ensure that burdens on employers are minimised. If you have any points that you feel we should make, please contact Peter Bickley


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