What is a P11D?

A P11D is the form UK employers use to report benefits in kind (BIKs) and reimbursed expenses provided to employees and directors to HMRC. Benefits in kind are non-cash items or perks that have a monetary value, and most are subject to income tax and employer National Insurance contributions.

What Must Be Reported on a P11D

Any taxable benefit or expense payment that has not been payrolled or covered by a dispensation must be reported. Common items include:

Company Cars and Fuel

Item	What to Report
Company car	List price, CO2 emissions, fuel type, dates available, capital contributions
Car fuel	Whether employer paid for any private fuel
Company van	Whether available for private use
Van fuel	Whether employer paid for private fuel

Financial Benefits

Beneficial loans — loans of £10,000 or more at below the official rate of interest (2.25% for 2024/25)
Relocation expenses — amounts above the £8,000 tax-free threshold
Credit cards and charge cards — private expenditure paid by the employer

Insurance and Medical

Private medical insurance — premiums paid by the employer
Income protection insurance — employer-paid premiums
Life insurance — only if not through a registered group life scheme

Assets and Accommodation

Assets provided for private use — e.g. computers, furniture, equipment
Assets transferred to the employee — at less than market value
Living accommodation — provided by the employer (unless exemptions apply)

Other Benefits

Subscriptions and memberships — unless on the HMRC approved list for the employee’s profession
Entertainment expenses — if not wholly business-related
Travel and subsistence — any amounts exceeding benchmark rates or not covered by a scale rate approval
Telephone — a second or additional mobile phone (first phone is tax-free)

What Does Not Need to Be Reported

Certain benefits are exempt from P11D reporting:

Employer pension contributions to registered schemes
One mobile phone per employee
Workplace parking
Trivial benefits costing £50 or less per occasion
Annual staff parties up to £150 per head
Cycle to work equipment under an approved scheme
Eye tests and corrective glasses for VDU users
Canteen or workplace meals available to all staff
Benefits that are being payrolled through PAYE

P11D Deadlines

Deadline	Requirement
6 July	Submit P11D and P11D(b) to HMRC
6 July	Provide a copy of P11D to each affected employee
22 July (electronic) or 19 July (cheque)	Pay Class 1A NICs to HMRC

These deadlines apply to the tax year ending the previous 5 April. For example, for the 2024/25 tax year, the deadlines fall in July 2025.

P11D(b) — Declaration of Class 1A NICs

Alongside the individual P11D forms, the employer must submit a P11D(b) form. This is a summary declaration showing the total Class 1A National Insurance contributions owed on all benefits in kind.

The Class 1A NIC rate is 13.8% of the total taxable value of all benefits reported on P11Ds (and any payrolled benefits).

Example Calculation

If an employer provides the following benefits to their workforce:

Benefit	Total Taxable Value
Company cars	£45,000
Private medical insurance	£12,000
Beneficial loans	£3,000
Total	£60,000

The Class 1A NIC liability would be: £60,000 × 13.8% = £8,280

How P11D Values Are Calculated

Each type of benefit has specific HMRC rules for calculating the taxable value:

Company Cars

The benefit value is calculated as:

List price × BIK percentage (based on CO2 emissions)

CO2 Emissions	BIK % (2024/25)
0 g/km (electric)	2%
1–50 g/km	2%–14%
51–54 g/km	15%
100 g/km	25%
160+ g/km	37%

If the car is only available for part of the year, the benefit is pro-rated for the number of days available.

Beneficial Loans

For loans of £10,000 or more, the benefit is calculated as:

Outstanding loan balance × official rate of interest (2.25%) − any interest actually paid by the employee

The calculation can use the average method (average of opening and closing balances) or the precise method (exact daily balances).

Private Medical Insurance

The taxable value is simply the cost to the employer of providing the cover — the premium paid.

Assets Provided for Use

The annual taxable value is 20% of the market value of the asset when first provided, plus any additional costs the employer incurs.

Payrolling Benefits as an Alternative

Since April 2016, employers can elect to payroll benefits instead of reporting them on P11Ds. This means the taxable value is added to the employee’s gross pay each period and tax is deducted through PAYE in real time.

Advantages of Payrolling

Real-time tax collection — no end-of-year adjustments needed
No P11D required for payrolled benefits
Transparency — employees see the benefit value on their payslip
Simplified year-end — fewer forms to complete

How to Set Up Payrolling

Register with HMRC before the start of the tax year via the online payrolling benefits service
Choose which benefits to payroll (can be selective — some payrolled, others on P11D)
Calculate the monthly benefit value and add to each employee’s taxable pay
Report through RTI as part of the normal FPS

Even when payrolling, the employer must still submit a P11D(b) to declare Class 1A NICs on all benefits, whether payrolled or not.

How P11D Affects the Employee’s Tax

When a P11D is submitted to HMRC, the benefit values are used to adjust the employee’s tax code for the following year. HMRC collects the tax by:

Calculating the total taxable benefit value
Reducing the employee’s tax-free allowance by that amount
Issuing a new tax code to the employer
Tax is then collected in instalments through the following year’s PAYE

For example, if an employee has a company car with a BIK value of £6,000, their tax code might change from 1257L to 697L, reducing the annual tax-free allowance from £12,570 to £6,970.

P11D and Directors

Directors are treated the same as employees for P11D purposes, but certain additional considerations apply:

Directors of close companies (broadly, companies controlled by 5 or fewer shareholders) may have additional reporting requirements
Beneficial loans to directors are always reportable regardless of amount if the director is a participator in a close company
Living accommodation rules have specific conditions for directors

Record Keeping

Employers must keep P11D records for at least 3 years after the end of the tax year. Records should include:

Details of each benefit provided to each employee
Calculations showing how the taxable value was determined
Supporting documents (invoices, insurance policies, car details)
Copies of P11D and P11D(b) forms submitted

Penalties for Late or Incorrect P11D Filing

Offence	Penalty
Late P11D submission	£300 per form, plus up to £60 per day after an initial penalty notice
Incorrect P11D	Up to 100% of the tax lost, depending on the reason (careless vs deliberate)
Late payment of Class 1A NICs	Interest charged plus late payment penalties
Failure to provide P11D to employee	Up to £300 per form

P11D and Other Payroll Documents

The P11D works alongside other payroll documents:

Document	Relationship to P11D
P60	Shows pay and tax from salary; P11D adds benefits
P45	Issued to leavers; P11D still required for benefits provided during employment
Payslip	Shows payrolled benefits in real time; P11D covers non-payrolled benefits
RTI FPS	Reports salary and payrolled benefits; P11D reports remaining benefits

P11D and Accounting

The benefits reported on P11Ds represent real costs in the employer’s accounting records :

Entry	Account	Timing
Benefit cost	Debit: employee benefit expense	When incurred or accrued
Class 1A NIC	Debit: employer NIC expense	Accrued monthly, paid by July
Class 1A NIC payment	Credit: bank	When paid to HMRC

The total cost of benefits, including the 13.8% Class 1A NICs, should be factored into employment cost budgets and workforce planning alongside salary and pension costs.