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P11D reporting: Preparation and processes

It's that time of year when thoughts turn to reporting employee benefits and expenses...

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Whenever May comes around, on AccountingWEB we start to see an increase in Any Answers conversations around benefits in kind and other sundry expenses - especially cars and vans.

Judging from the scale of traffic around the issue, it looks like a smaller scale rerun of the January SA filing deadline takes place in the weeks leading up to 6 July.

To get the ball rolling this year, I'm looking into how businesses and their advisers prepare for the task. Who does the work, when and using what processes and tools to compile and file the P11D forms?

I'm particularly interested in any features in bookkeeping or payroll tools that take care of these tasks, or if people are using some of the specialist applications out there. If so, would you recommend those apps to other accountants, and why?

And finally, Tom Herbert wrote six years ago that the end was nigh for P11Ds, yet those pesky forms have survived Brexit and Covid-19 intact and are still part of the administrative landscape. From that point of view, what changes do you anticipate for expenses and benefits in kind reporting and are you building them into your plans for the future?

Starting with your feedback, we'll go out and do further research for an article looking at current systems and processes, and perhaps a revival of that old end of the P11D debate. Thanks.

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By kestrepo
28th Apr 2022 09:43

P11D's are a one a year task and I find it is easy to forget what I had remembered at the end of the task the year before!! I usually use Tax Shield - I have no affiliation but find that the price (admin + per employee) structure works for me.

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By Hugo Fair
28th Apr 2022 11:42

Although HMRC have been incredibly slow even by their low standards (starting well before the arrival of the pandemic or even Brexit), the "death of the P11D" was predicted on the basis of everyone rushing to 'payroll benefits' during the year instead.

Unfortunately HMRC did their usual 'things' and:
a) failed to promote the concept properly (in terms of the benefit, sorry, to employers);
b) ignored all the feedback they received from developers and practitioners before the start - relating to many BiKs requiring data to be reported that wasn't held on Payroll software (or in some cases known accurately until end of year);
c) hadn't brought their 'in-year' tax re-coding facilities up to scratch in time for the introduction of 'payrolling benefits';
d) assumed that, despite all the above, payroll depts would be happy with a deadline that means applying for the method (and specifying the benefits etc) before the start of the tax year in which it will be applied.

I could go on ... P11D(b) still required for paying class 1A NICs ... but either HMRC was never really wedded to the concept, or it's another example of their inability to score even when the goal is unprotected & open!

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