If you pay expenses or benefits to your staff or directors you will need to tell HMRC and pay tax and National Insurance (NI) on them.
Benefits include:
- Health insurance
- Company cars
- Travel and entertainment expenses
- Childcare
Here’s a full list of expenses and benefits.
At the end of the tax year you’ll need to send an end-of-year form to HM Revenue and Customs (HMRC) for each employee that has been provided with expenses or benefits.
The form will either be a P9D or a P11D, depending on how much the employee earns.
You can submit a report via payroll software, HMRC’s PAYE online service or via HMRC’s expenses and benefits online form.
You can also download the forms and send them to your HMRC office:
P9D for employees earning less than £8,500.
P11D (b) to report Class 1A NI contributions due on expenses and benefits
More information is available from PAYE end of year expenses and benefits