Two women having a business meeting at a desk in the DASH Accounting Services office

It’s that time of year again when P11Ds fall due, and it is easy for SME business owners and finance teams to forget them. P11Ds often cause a lot of confusion for teams and business owners alike. People are generally unsure what they are, what goes on them or if they have missed something important.

What is a P11D?

A P11D is the form employers use to tell HMRC about any taxable benefits and expenses given to employees or directors that weren’t processed through payroll. If your team receive anything on top of their salary eg a company car, private health cover, or a low-interest loan and that benefit wasn’t processed through your payroll software during the year, you need to report it on a P11D. There’s one form per employee who received reportable benefits. You also need to file a P11D(b), which is the summary form that declares the total Class 1A National Insurance your business owes on those benefits.

What should be included?

This is where people often get confused. Benefits in kind are broader than most employers assume.

Common items that need to go on a P11D:

  • Company cars: one of the most common, and one of the most frequently miscalculated. The taxable value depends on the car’s list price and CO2 emissions.
  • Private medical or dental insurance: if you pay for health cover for employees, it’s a benefit in kind.
  • Fuel benefits: if you pay for private fuel on a company car, this is reported separately.
  • Beneficial loans: any loans to employees at below the official HMRC interest rate (currently reviewed quarterly from April 2025 onwards).
  • Gym memberships: unless the facility is on-site and available to all staff.
  • Accommodation: if the business provides living accommodation to an employee, it’s usually reportable.
  • Subscriptions and professional fees: if these are personal rather than wholly business-related.

 

What you don’t need to report:

 

  • Expenses that are wholly, exclusively, and necessarily for business purposes (and where you have proper controls in place).
  • Trivial benefits worth £50 or less per item eg a Christmas gift, a bunch of flowers, a bottle of wine. These are exempt as long as they’re not cash or a cash voucher, aren’t part of salary sacrifice, and aren’t a reward for performance.
  • Benefits already processed through payroll (though you still need to file a P11D(b) to declare the Class 1A NIC).

If you’re not sure whether something counts, that’s worth a conversation with your accountant before the deadline.

 

Key Dates for 2026

6th July: P11D and P11b forms must be filed with HMRC online. Paper forms are no longer accepted.

19th July 2026: deadline to pay Class 1A National Insurance if paying by post.

22nd July 2026: deadline to pay Class 1A National Insurance electronically.

 

What happens if you miss the dealine?

Missing a P11D deadline means HMRC will enforce automatic penalties. They are usually £100 per 50 employees per month for late filing and late payment can attract interest on the amounts due.

 

It is also worth noting that from April 2027 it will be mandatory for emplyers to report and pay tax on most benefits in kind through payroll software in real time. If you’re not already thinking about how to transition your payroll process, now’s a good time to start. It affects how your employees experience their pay, their take-home will change once benefits are taxed in real time rather than via tax code adjustments at year end.

 

Not sure how this affects you?

If you are a SME business owner or work within a finance team and are unsure how these changes may affect your business or how to build in these changes to your payroll, we can help.

At DASH, we handle the payroll and compliance side for a range of UK SMEs so our clients don’t have to worry about missing a deadline or getting the calculations wrong.