Save content
Have you found this content useful? Use the button above to save it to your profile.
AIA

Benefits reporting: what you need to know

by
7th Jun 2011
Save content
Have you found this content useful? Use the button above to save it to your profile.

The year-end PAYE process doesn’t end on 19 May, warns Chartered Institute of Payroll Professionals (CIPP) policy officer Diana Bruce. In this comprehensive guide to P11D reporting, she sets out the processes that must be completed by 6 July. The section on dispensations has been updated to take account of amendments suggested by AccountingWEB.co.uk members in comments below.

Accountants and payroll managers breathing a sigh of relief as they complete their PAYE year-end duties mustn’t relax too much. Next on their agenda will be the 6 July P11D filing deadline.

Since the introduction of self assessment in 1997, employers have been required to calculate cash equivalent values of expenses and benefits provided to their employees.

When the PAYE system was first introduced only P9D benefits were assessable. However, over time company owners and managers realised they could work the rules so that if the company paid for certain items, employees would only have to pay the tax on the secondhand value as opposed to the original full value. This tactic prompted the introduction of the P11D. 

HMRC guidance states that at the end of the tax year, you must report the expenses and benefits you've provided to your employees, and about the total Class 1A NICs due on them. To do so, you must use the following forms:

  • P11D - for recording the expenses and benefits you provided to most company directors and to employees earning at a rate of £8,500 or more per year.
  • P9D - for employees earning less than the £8,500 rate.
  • P11D(b) - for reporting the total amount of Class 1A NICs due. You add this up from all the forms P11D you've completed. Even if you haven't had to file any P11Ds, you must still complete and return form P11D(b) if HMRC has sent one to you.

Submitting forms P11D and P9D isn't optional. If you've provided an employee with expenses or benefits that need to be reported, you must send HMRC the appropriate form and the employee must also be provided with a copy (also by 6 July) so that they can use it to complete their Self Assessment tax return, if applicable.

All transactions between employees and employers need to be declared, even if there is no tax liability. Forms must show the cash equivalent value of benefits or the taxable payment and any employee contribution to the cost. By 19 July you also need to pay any Class 1A National Insurance contributions (NICs) that are due on the expenses or benefits.

Dispensations & PAYE settlement agreements (PSAs)*
Employers can apply for dispensations to ease the reporting burden where expenses and benefits are paid to employees. If HMRC agrees one, a dispensation will reduce the paperwork by removing the need to report non taxable expenses and benefits to HMRC at the end of the year on forms P11D or P9D.

There is normally no requirement to pay any tax or NICs on routine expenses such as travel & subsistence where the amounts are within HMRC's acceptable limits, and are not subject to any tax or NICs. To apply for a dispensation there is an admin process which is via the P11D(X). 

Once the dispensation has been agreed by HMRC there is normally no need to apply again, providing there is no change in rates or items. Usually the agreement will stay in place for around five years, at which point it will be reviewed. Good practice however is to review your dispensation on a regular basis and at least once a year. HMRC has introduced a facility to allow employers to apply for dispensations online.

There is also an option for employers to pay the tax due on benefits provided to employees for minor, hard to value,  and irregular items.  This is known as a PAYE Settlement Agreement. Information on this process can be found on the HMRC website.

Where Class 1A NICs due on P11D items are due by 19 July, you are given until 19 October to pay any Class 1B NICS due on a PSA. If paying electronically these dates extend to the 22nd of July and October.

Calculating the £8,500 threshold
Is a P11D or a P9D required for the employee? In essence, this depends on whether they earn less or more than £8,500 a year. The calculation must include salary, all payments of overtime, commission, bonus and so on, plus the cash equivalent of all benefits and any expenses – including those where a tax deduction may be claimed.

Some expenses are not included, namely contributions made to an approved super annuation fund and/or to an approved payroll giving scheme.

National Insurance & PAYE Service (NPS)
We all know about HMRC’s new NPS, probably for all the wrong reasons. It has highlighted so many tax coding errors since its introduction that it is being seen as a negative change and not a positive one. However, when all the data has been cleansed HMRC will have a far more accurate system. Unfortunately during the interim it is having to deal with a backlog of errors.

NPS has also caused disruption due to the late application of 2009/10 P11Ds. The records are now being linked to individuals rather than employers and this has made the matching process more efficient. The updated system has given HMRC a truer picture of a tax payer record and is catching up with the P11D backlog. Unfortunately some people ended up with Month 1 codes for the last three months of the tax year, and were effectively being taxed for nearly two years’ worth of benefits. This is no fault of the employer, but a consequence of a new and more efficient system.

Common P11D errors

HMRC accepts there have been some coding issues, but as is its habit, highlighted two common errors that employers make when completing their P11Ds:

  • Fuel benefit omission – you need to include the details where this applies and a number of employers omitted the information from their forms. Amended P11Ds are required to correct the employee’s tax code.
  • Incorrect completion of “from and to” dates – some employers have completed the boxes for “dates car available” giving the period dates of 6/4/2009 to 5/4/2010. If the car was available in the previous tax year then the “from” box should not be completed. This also applies if the car will be available in the next tax year – the “to” box should remain open so that the tax code is carried into the next year (2011/12).

Both errors will mean employees receive incorrect tax codes. Where there is a change of tax code, staff may receive their pay slips, with a change in take home pay (this is dependent upon the error type) and this could mean less pay or a large refund if the new code is wrong.

Additionally there have been problems for employers sending P11D information in list format to HMRC. They have a quality standard for P11Ds to help increase the amount of information that can be processed without the need for further contact between HMRC and employers. To avoid rejection or the need to re-submit the information, employers should:

  • present your list in an easy to read format, using at least font size Arial 11
  • enter all benefits for each employee on one list; HMRC cannot accept separate lists for each benefit
  • show the employer reference, employee’s name, National Insurance number, date of birth and gender
  • show the full range of benefits, including the benefit code numbers as shown on form P11D.

Paper P11D and P11D(b) for 2010-11: new address
HMRC have now set up a dedicated post room to deal with the receipt of paper P11D & P11D(b) submissions for 2010-11. Please address your envelope to:

HMRC NIC&EO
P11D Support Team
Tynemouth House
Room BP8019
Benton Park View
Longbenton
Newcastle Upon Tyne
NE98 1ZZ

Full guidance on how to complete each section of the forms is available from HMRC and guidance on BusinessLink.gov.uk outlines the different methods you can use to complete and file these three forms. It also contains a list of common errors to avoid and sets out the key information you need to provide on each form.

*The section on dispensations and PSAs was amended in response to the comments below. The author is aware of the differences between the two, but recognised that the original wording did not portray that difference clearly and submitted the amendments now published. Both the CIPP and AccountingWEB.co.uk apologise for any confusion. The address published for submitting Paper P11D(b)s is taken from HMRC's 20 May 2011 employer update.

Replies (40)

Please login or register to join the discussion.

avatar
By Optimum PAYE
08th Jun 2011 08:06

Getting mixed up

This article is getting into a bit of a muddle in parts.

A P11D Dispensation and a PAYE Settlement Agreement are two completely different things.

A Dispensation is of course an agreement to exclude certain non taxable items from the P11Ds. Whereas a PSA is a separate arrangement allowing the employer to report certain taxable items outside of P11Ds and, importantly, to settle the tax and NI on these taxable payments on behalf of employees.

Also, car fuel benefits are reportable on P11Ds, it is very unusual (but not impossible) that they would be allowed to be incuded within a PSA.

Thanks (0)
By JCresswellTax
08th Jun 2011 09:12

I agree

Strange article to be posted when something as fundamentally wrong as that could be missed!?!?!?

Thanks (0)
avatar
By Paula Sparrow
08th Jun 2011 11:40

This is misleading

The article implies that a dispensation removes the need to report taxable benefits, which is simply not correct.  It reads as though written by someone who has had limited involvement with P11ds and only half understands the systems and implications.

Thanks (0)
By petersaxton
08th Jun 2011 11:43

This is very bad

“All transactions between employees and employers need to be declared, even if there is no tax liability.”

Even if there is no dispensation in place this is simply not true – see 480(2011) page 11:

“Purchases on employer’s behalf

Businesses are often run in such a way that employees make payments on their employer’s behalf.

For example, an employee may buy stamps, stationery and items of equipment for the employer

and be reimbursed the costs incurred from petty cash or by cheque. Such transactions are not

providing the employee with either earnings or expenses because the employee has received no

money of his own. Accordingly such reimbursements do not feature on the P11D.”

Thanks (0)
avatar
By Barkster
08th Jun 2011 12:26

Still Unclear

I am still unclear whether the reimbursement of expenses by the company to an owner/director should go on a P11D ?

I am talking about small amounts of travel, subsistence, stationery etc purchased by the director either with his own cash or debit/credit card.

Not only do you have to do a P11D, but then the other form to claim that they are all legit business expenses and shouldn't be taxed.

Is it sufficient to just put the expenses and tax claim on the SA return ?

I received a letter from HMRC 18 months ago in response to such a question, where they said:

 

"As your client completes a self assessment tax return no further action regarding his expenses is necessary. I note from the 2009 Tax Return that he has declared the monies he received from His Company ltd and then claimed them as expenses, which is correct."

They then said:

"An employee who does [not?] meet the criteria for self assessment should obtain and sign a section 336 claim".

So I did not send a P11D last year !

 

 

 

 

Thanks (0)
By petersaxton
08th Jun 2011 12:36

A nonsense

Too many in HMRC make it up as they go along. But if you have a letter from them you should be fine.

You should enter travel and subsistence on a P11D but not stationery.

I am presently of the understanding that if you "consume" something - travel, subsistence, entertaining, phone calls" then they should go on the P11D but if you are simply an agent for the company's consumption then not - stationery, computer. This is all a nonsense because you are consuming the travel, etc. on the companies behalf.

I think P11Ds should be the first thing they should simplify.

Thanks (0)
avatar
By spurs1952
08th Jun 2011 12:50

P11Ds

 Dear Peter, thank you for your jewel of an answer in a sea of despair.  Why do the HMRC not make the point you highlight clearer covering the situation of Director A paying £x on behalf of Company B for their direct company expenses and just being re-imbursed £x for this - there is no taxable benefit in this transaction.  Could it be the HMRC like to fine people for supposed non -compliance of completing the P11D correctly or am I just cynical.

Thanks (0)
By petersaxton
08th Jun 2011 13:14

Reasons

I've given up being totally cynical about their motives. I suspect it's due to stupidity given what I have seen. There is the supposed explanation of what to include on a P11D http://www.hmrc.gov.uk/guidance/p11dguide.pdf but I have never been too impressed by it. For years I had entered every expense payment that was made until I saw the note regarding expenditure as an agent. Both before and after this I have been told by HMRC staff that every payment has to be included on a P11D and other times I've been told that only payments that are a benefit should be included on a P11D.

It would seem sensible to only include benefits and expenses which were taxable.

Given HMRCs record so far I think that would be beyond their abilities.

Thanks (0)
avatar
By glynisbm
08th Jun 2011 13:20

What about Class 1 NIC?
I think HMRC have left out a very common error which is that not all benefits attract a Class 1a NIC liability. If the employer makes a payment on behalf of the employee, this should be entered in Box B of P11D to pick up the Class 1 Charge, which should be collected through payroll at the time it is paid. Failure to do this means that only secondary contributions will be paid over (in reality the Class 1 a NIC liability which is of the same amount as secondary Class 1)
The loss for HMRC is the primary Class 1 NIC (employees contribution) and the subsequent knock on effect on the contributory principle.

Thanks (0)
avatar
By MacDonald9
08th Jun 2011 13:44

P11Ds and Company Card Payments

It is probably a good thing that the article has left space to spark such a flow of helpful advice! My query is - does the question of including travel, hotel and subsistence expenses on a P11d differ if the director uses a personal debit / charge card or a company debit/charge card to settle the bill?

Thanks (0)
By petersaxton
08th Jun 2011 13:56

No

If it's a company credit card it should go on the P11D.

If it's a personal credit card it should go on the P11D because the director is effectively submitting an expenses claim when the director's loan is credited or the expenses are refunded.

If anybody can explain the reasoning for having a requirement to put such expenses on a P11D I would love to know.

Thanks (0)
avatar
By Swedish Chef
08th Jun 2011 15:40

Wrong address given?

All of the P11D(b)s that we have seen need to be returned to Chillingham House, rather than Tynemouth House.

Thanks (0)
By sue scherzo
08th Jun 2011 16:16

P11d s

Was it kind to print this article? it could be used as a test paper for trainees as 'spot the error'!

Can the publishers make sure that in future artlcles of 'apparent' merit are checked first.

Thanks (0)
avatar
By pauljohnston
08th Jun 2011 19:10

Error correction

It seems to me that this article should have been written by Peter Saxton (editor of accounting web pls note for next year).  Does anyone know what CIPP (policy officer ) as mentioned at the beginning of this article mean?

Thanks (0)
By petersaxton
08th Jun 2011 19:42

P11D Guide, 480 booklet and CIPP

I’m afraid I’ve only picked up what I do based on many years trial and error. There’s been very little practical help from HMRC – including the http://www.hmrc.gov.uk/guidance/p11dguide.pdf .

Worrying, despite the paragraph below being fundamental to the completion of a P11D, it is on page 11 of the 480 booklet but not on the P11D guide (as far as I can see):

“Purchases on employer’s behalf

Businesses are often run in such a way that employees make payments on their employer’s behalf. For example, an employee may buy stamps, stationery and items of equipment for the employer and be reimbursed the costs incurred from petty cash or by cheque. Such transactions are not providing the employee with either earnings or expenses because the employee has received no money of his own. Accordingly such reimbursements do not feature on the P11D.”

I’ve learned the most from other AccountingWeb members.

Frighteningly, CIPP stands for Chartered Institute of Payroll Professionals.

Thanks (0)
avatar
By Pinkfernleaf
08th Jun 2011 19:49

Address
The employer should send their P11d to Chillingham house instead of Tymouth House as I was told by HMRC.

Thanks (0)
avatar
By pauljohnston
08th Jun 2011 20:56

Tongue in cheek

Peter how would you deal with toliet paper purchased by an employee.  It is for his private use in the business toilet... 

Thanks (0)
By petersaxton
08th Jun 2011 21:04

Depends

"Peter how would you deal with toliet paper purchased by an employee.  It is for his private use in the business toilet... "

If it's for his private use and he was refunded by his employer it is a benefit in kind.

If he'd bought it for use by anybody who used that toilet he would be buying it as an agent of the business and it wouldn't have to be reported.

Thanks (0)
Nichola Ross Martin
By Nichola Ross Martin
08th Jun 2011 23:26

PiiD howlers

There have been a lot of complaints about this article and I have written in to suggest that it is withdrawn for correction. The complaints are mainly as noted above, so no point in repeating.

The section number that you are all thinking about in relation to employee expenses that do not need to be reported come under the header of "Accommodation, supplies and services used in employment duties" which is otherwise known to you and me as "post, printing, stationery and whatever else the boss asks you to buy for the company" is s316 ITEPA 2003, so if expenditure fits that header and is reimbursed you don't need to report it as it is specifically exempted from being employment income. Otherwise apply for a dispensation from reporting certain other expenses. You can do this online, but I warn anyone, that in the light of the new-ish tax penalty regime, you should take proper guidance before completing it as your responses may come back to haunt you at a later tax inspection.

Virtual tax support for accountants at: www.rossmartin.co.uk

Thanks (0)
John Stokdyk, AccountingWEB head of insight
By John Stokdyk
09th Jun 2011 09:34

Thanks and apologies

Thank you all for the robust feedback, and our sincere apologies to anyone who may have been misled by the original draft. Diana Bruce contacted me with amendments yesterday afternoon, but due to the failure of my laptop, I wasn't able to act until this morning.

Diana does understand the difference between dispensations and PSAs and apologised if the original wording did not make this clear. At our request, she delivered the piece in a short timeframe and missed the reference in her review. I compounded the confusion by not picking it up during editing, for which I would also like to apologise.

It is very helpul to have such an energetic peer-review committee on AccountingWEB, but as some of you point out, it would be far more preferable to get things right in the first place. We will review the incident internally and consider options that would give us a better level of technical accuracy.

I am certainly not an expert on benefits and PAYE, and as the debate here has shown, there are a lot of grey areas and anomalies in HMRC's guidance. For example, those who insist that paper forms should go to Chiddingly should note the 22 May Employer Update, which includes the new post room address at Long Benton.

I'm also consulting Diana about Peter Saxton's point on payments made on the behalf of employers for things like stationery and equipment. We may add a further paragraph to the piece to reflect his advice and that of Nichola Ross Martin.

Thanks (0)
avatar
By pauljohnston
09th Jun 2011 11:14

Jon

Just because a HMRC bulletin tells you something you should not necessarily believe it.  Just read thru the thousands of entries on AWeb to realise that a fair number of us are cynical about information released.  The address at Chillingham House is that should on the P11d (b) that has been sent out by HMRC .  In MHO HMRC are again in a muddle.  If it had been an accountant setting this new address it would have been deferred until 1 August.

Thanks (0)
avatar
By Barkster
09th Jun 2011 11:27

Addressing issues

 I wouldn't all get too fired up about sending these things to the right or wrong address.

I recently responded to an enquiry, to the office in Cardiff from whence the enquiry came, a few weeks later the officer phoned to ask where my reply was - I faxed over a copy and got it all sorted/

A few weeks later still, I get a call from an office in Hull asking me what did they want me to do with the letter I had sent to Cardiff and which had turned up there !!

Apparently, many tax offices don't actually open their own post - they send it away to be opened elsewhere, then it gets suitably shuffled, and some, if you are lucky, may end up back at the office to which it was originally sent !!

So how hard can it be to open your own post ? I thought there were millions of unemployed people ?

I suppose at least they aren't flying all the post to Malaysia to be opened, yet !

 

(Sorry if I am getting off-topic, but the address arguments are a bit pointless).

 

 

Thanks (0)
avatar
By GWhaley
09th Jun 2011 13:04

P11ds

Read this bulletin with interest. I have found, when completing P11ds online, that if I report expenditure which is obviously not taxable, it nevertheless automatically calculates the NI on it. There doesn't seem anywhere to report the expenses as non taxable, thus nullifying the NI. What trick have I missed?

Thanks (0)
avatar
By rosataylor
09th Jun 2011 13:33

addressing issue
True in deed. HMRC are in a muddle. The big question is when will they get their act together.

Thanks (0)
By petersaxton
09th Jun 2011 14:33

Addresses

If HMRC are centralising things and scanning post why don't they tell everybody by announcing it and having a central posting address?

As usual they seem to be doing things in a confused way.

If you look on the HMRC website you would not know that there's been any changes unless you really dig around.

Thanks (0)
avatar
By Chris Wise
10th Jun 2011 08:59

HMRC Addresses

I was looking for an address for a HMRC office the other day. couldn't find the page that used to let you put in the distrct no and then it gave you the address, but I did find this.

http://www.hmrc.gov.uk/agents/contacting-effective.htm

Which basically says there are now two addresses for income tax, one for SA and one for non SA.  (Look right at the bottom of ther page) Not sure when they snuck that in, but I recall seeing something on an agent update about the centraliseation of post.

Thanks (0)
By petersaxton
10th Jun 2011 09:20

Why?

It's not exactly prominent.

They seem to be trying to make it very hard for anybody to know how to contact them.

Isn't the obvious place to put it on the Contact Us section?

Thanks (0)
avatar
By pauljohnston
10th Jun 2011 14:05

Peter. Why are you suprised?

HMRC are in a muddle I think we all agree and this proves it once again.

Thanks (0)
By petersaxton
10th Jun 2011 14:23

Bananas?

I'm not surprised.

This country is getting more like a banana republic every day.

 

Thanks (0)
avatar
By Chris Wise
10th Jun 2011 14:33

Scanning

There was also this this morning

http://www.hmrc.gov.uk/news/changes-incoming-mail-golive.htm

 

On the subject of scanning, but selective scanning it would appear.

Thanks (0)
avatar
By Bluffer
10th Jun 2011 14:45

Use of debit cards

MacDonald9 asked about the use of debit cards in two scenarios. I've always treated the two scenarios differently, but I'm unsure whether I'm correct.

Where a director purchases an item for the company and uses the company debit card, I regard that as the same as paying by company cheque - nothing to report on the P11D.

Where the director pays using his private debit card and is then reimbursed, he is effectively making an expense claim so an entry is required on the P11D

Any alternative treatments?

Thanks (0)
avatar
By Bluffer
10th Jun 2011 14:48

Nichola: P11D howlers

You refer to s316 ITEPA 2003. Doesn't this section relate to "benefit-type" rather than "reimbursed expense-type" situations?

I'm confused!

Thanks (0)
By cfield
18th Jun 2011 16:19

P11Ds for people working at home

Going back to the issue regarding employee purchasing items such as postage and stationery on behalf of the employer, I've always departed from the usual rule that these do not need to go on P11Ds in the case of directors working at home (eg one-man companies) for the reason that it is too easy for the taxman to say that there could be some private use. As it is usually necessary to file P11Ds anyway for small companies (unless you can get a dispensation without all the hassle you often get from old-school compliance officers) it is just as easy to be on the safe side and report these items too.

Same goes for computers and other equipment. It can be very easy for the taxman to suggest there may be an element of personal use (if he ever found out about them). My solution has always been to get the client to sign a form stating that the computer (serial number quoted) belongs to the company and has been assigned to the employee for the following duties and no private use is allowed unless it is "insignficant". Then scan it back to me by e-mail so there is contemparaneous evidence. Might be slightly paranoid but it's no real hassle and plays safe.

Incidentally, there is a brilliant article about P11ds on the link below:

http://static.bdo.uk.com/assets/documents/2010/05/P11DGuide.pdf

It refers to 2009/10 so there are a few changes on company cars but most of it of course is still valid. This tells you everything you need to know about P11Ds. Even those of us who regard ourselves as knowledgeable on PAYE benefits may find a few things they didn't know, so I would advise everyone to read it.

And you don't even need to register as a member :-)

Chris

Thanks (0)
By petersaxton
18th Jun 2011 17:41

Debit cards

 

"MacDonald9 asked about the use of debit cards in two scenarios. I've always treated the two scenarios differently, but I'm unsure whether I'm correct.

Where a director purchases an item for the company and uses the company debit card, I regard that as the same as paying by company cheque - nothing to report on the P11D.

Where the director pays using his private debit card and is then reimbursed, he is effectively making an expense claim so an entry is required on the P11D

Any alternative treatments?”

I would have done the same as you but it does appear that using a company debit card should be reportable. If there is more than one director how would we know who’s card is used? Do we have to identify which cards are used and allocate it to those director? 

Thanks (0)
By cfield
19th Jun 2011 11:52

Corporate cards

I would say Yes as it is necessary to know who "consumed" the item, whether it be travel, subsistence, entertainment or some other expense which the employee benefited from. It doesn't really matter how the item was paid. The only thing that might matter is if the contract was with the employer, which affects whether it was a pecuniary benefit or not.

Most corporate cards show who the user is so it should be straightforward to analyse them. The book-keeper should have a separate account for each card and any P11D items should obviously be coded separately. I always split them to taxable and non-taxable items, with a separate account for any PSA items such as staff entertaining. It would obviously be a major headache trying to analayse all this at the end of the tax year so best if the client or book-keeper is trained to do it on an ongoing basis.

Chris

Thanks (0)
By petersaxton
19th Jun 2011 12:58

Multiple current account debit cards

"Most corporate cards show who the user is so it should be straightforward to analyse them. The book-keeper should have a separate account for each card and any P11D items should obviously be coded separately. I always split them to taxable and non-taxable items, with a separate account for any PSA items such as staff entertaining. It would obviously be a major headache trying to analayse all this at the end of the tax year so best if the client or book-keeper is trained to do it on an ongoing basis."

There can be more than one debit card for a current account and I would think it is less easy to analyse them as they are mixed with everything else that goes through the current account.

Other than complying with the legislation I fail to see what is the use of all this analysis.

Thanks (0)
By cfield
19th Jun 2011 14:41

All that analysis

"Other than complying with the legislation I fail to see what is the use of all this analysis."

Well there isn't any, unless the boss wants to know who spent the most on entertaining, etc. But the law says we must report expenses per individual, and this is the only way of doing it, so that is reason enough.

 

"There can be more than one debit card for a current account and I would think it is less easy to analyse them as they are mixed with everything else that goes through the current account."

True, although the statements usually show the transaction date, so that should indicate who incurred the expenditure. Also, if there is more than one director, it is usually easier to obtain a dispensation that includes entertaining and benchmark subsistence, which they still seem reluctant to grant for sole directors.

Chris

Thanks (0)
avatar
By joshia2
22nd Aug 2011 11:06

Employee Tax Code P11D

Hi

We have filled the P11d (2010/11) for an employee who has been given a Company Van for Business Use only( Section G). His contract says that he will keep a log of any personal use.

The benefit was £3k.

Now he has received a notice from HMRC that his Tax code for 2011/12 will be reduced by £3k.

Reading from P11d guidance form I believe that he should not be taxed as the van is used for Business & home to work use only.

Am I right that he should not be taxed?

 

Alan

 

Thanks (0)
By petersaxton
22nd Aug 2011 11:27

Seems like a benefit to me

"Reading from P11d guidance form I believe that he should not be taxed as the van is used for Business & home to work use only."

What is the guidance that says home to work is not a benefit.

What is the change in tax code?

Thanks (0)
By cfield
22nd Aug 2011 11:59

Company vans - home to work travel

Home to/from work travel in company vans is specifically exempt under the new company vans regime that came in a few years ago. It sugared the pill of the new regime a bit as the scale charge went up from £500 to £3,000.

The trick is proving that a company van is home to work (and/or business use) only. It usually means keeping a mileage log and all the fuel receipts, which van drivers are notoriously bad at doing. The only other thing you can do is estimate mileage restrospectively and try to reconcile it to the odometer figures (if you have them).

Chris

Thanks (0)