Payrolling Benefits – Are you still to join the monthly process?

04 March 2019

We are now coming to the end of the 3rd full tax year of operating the Payrolling Benefits scheme since its introduction by HMRC back in April 2016. This scheme brought flexibility to employers in reporting employee benefits by providing an option to process them through payroll on a real time basis rather than submitting P11D forms in July after the end of the tax year.

For employers who have gone ahead with implementing the scheme, they have expressed that the main benefit to them has been that the scheme has significantly reduced their administration time and costs surrounding employee benefits as P11Ds have to be submitted only if there were any benefits left out of payroll. Therefore, the only requirement, if all benefits are payrolled, is the P11D(b) form to confirm the total benefits payrolled and the Class 1A National Insurance due by 6th July following the tax year end.

Employees also see benefits from the scheme as their tax due on benefits provided to them is collected on a monthly basis along with their normal PAYE which reduces confusion with tax code adjustments which occur via the normal P11D reporting, as well as minimising the chance of underpayments of tax.

 If you are interested in starting to payroll employee benefits it’s not too late to register to do so for the 2019/20 tax year. Registration is open until 05 April 2019 and can be completed using your online HMRC dashboard.

 If you require any assistance or would like any further information on payrolling benefits, please do not hesitate to contact Megan McDonald ( or your usual AAB contact.

To find out more about Megan and the Payroll and Employment Taxes team, click here.

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