A: HMRC has pushed back the deadline for mandatory payrolling of benefits to 6 April 2027. Until then, employers can continue to payroll most benefits in kind (BiKs) voluntarily for Income Tax, as long as they register in advance. Registration must be completed before the tax year begins. HMRC recommends registering before the annual coding process starts—usually around 21 December—to avoid employers getting multiple tax codes for employees.
Starting in April 2027, most benefits in kind will usually no longer require employers to register them for payroll, except for loans and accommodation benefits. HMRC will update employees’ tax codes by removing current benefits as they get ready to introduce mandatory payrolling from April 2027.
HMRC have given further guidance at the following link Technical note: Mandating the reporting of benefits in kind and expenses through payroll software – an update - GOV.UK.
These publications from Markel Tax were correct at the time of going to press and should be considered as principles-based guidance only. To check current validity, call the Markel Tax helpline. ICAEW (as distributor) disclaims all liability for any errors or omissions.
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