P11D form (benefits in kind): what is it, when to file

Paying yourself or your employees doesn’t always stop at salary. Perhaps your company pays for private health insurance, provides a company car or lends a director money at a low interest rate.

Nice perks — but HMRC may still want to know about them.

Many taxable extras are classed as benefits in kind, and employers usually report them using a P11D form. It might sound like yet another piece of payroll paperwork, but the rules are fairly straightforward once you know which benefits count and when you need to report them.

Here’s what small business owners and founder-directors need to know.

In this article:

• What is a P11D form?
• What is reported on a P11D?
• What about payrolling benefits in kind?
• Do I need to file a P11D?
• How and when to submit your P11D

A P11D form tells HMRC about taxable expenses and benefits provided to an employee or director during a tax year.

These are usually non-cash extras someone receives on top of their salary. They’re commonly known as benefits in kind.

For example, imagine your limited company pays £600 for your annual private medical insurance. You haven’t received that £600 as salary, but you’ve still received something with financial value. Unless an exemption applies or the benefit is taxed through payroll, your company will normally need to report it.

The P11D records the type and taxable value of each benefit. HMRC uses this information to calculate:

• Any Income Tax the employee or director owes
• Any Class 1A National Insurance the employer owes

You complete a separate P11D form for each employee or director who received reportable benefits.

You may also need to submit a P11D(b). This summarises the Class 1A National Insurance due across all the benefits your business provided.

Common P11D employee benefits can include:

• Company cars and fuel available for personal use
• Private medical or dental insurance
• Interest-free or low-interest loans
• Living accommodation
• Assets given to an employee
• Certain travel and entertainment expenses
• Personal use of company credit cards
• Other non-business expenses paid by the employer

Not every workplace perk is taxable, though. Some expenses and benefits are exempt, while others may already be taxed through payroll.

For each reportable benefit, you’ll usually need details such as:

• The employee’s name and National Insurance number
• The type of benefit provided
• How much it costs the business
• Any amount the employee repaid
• The benefit’s taxable or “cash equivalent” value

The calculation can vary depending on the benefit. Company cars, accommodation and low-interest loans all have their own rules, so check HMRC’s guidance or ask an accountant if you’re unsure.

Example: Your company pays £720 for an employee’s private medical insurance. The employee contributes £120 towards it. You would generally report the remaining £600 as the value of the benefit.

A director’s loan can also create a benefit in kind if it is interest-free or charges less than HMRC’s official rate and the relevant conditions are met. Our guide what is a director’s loan explains everything you need to know, including tax rules to consider.

Small, occasional gifts may qualify as trivial benefits, meaning you don’t need to report them to HMRC or pay tax or National Insurance on them.

A benefit is only trivial if all of the following apply:

• It costs £50 or less to provide
• It isn’t cash or a cash voucher
• It isn’t a reward for someone’s work or performance
• It isn’t included in their employment contract or provided through salary sacrifice

So, a £30 bottle of wine given to an employee for their birthday could qualify. A £30 gift voucher promised for hitting a sales target wouldn’t, because it rewards performance.

Founder-directors need to watch one extra rule. If you’re a director of a “close” company (broadly, a limited company run by five or fewer shareholders) the total value of trivial benefits you can receive is capped at £300 per tax year.

And no, splitting a £100 gift into two £50 payments doesn’t make it trivial. The limit applies to the cost of providing the benefit itself.

Instead of reporting certain benefits after the tax year using individual P11D forms, some employers choose to payroll benefits in kind.

Payrolling means adding the taxable value of a benefit to the employee’s payroll throughout the year. The employee then pays the Income Tax as they receive the benefit, rather than HMRC collecting it later through an adjusted tax code.

For example, if you payroll an employee’s private medical insurance, its annual taxable value is usually spread across their pay periods. The additional tax is deducted through PAYE alongside the tax on their salary.

This can:

• Spread the employee’s tax across the year
• Reduce the risk of an unexpected tax-code adjustment
• Remove the need to submit a P11D for payrolled benefits

However, the employer must still calculate and report any Class 1A National Insurance through a P11D(b).

For the 2026/27 tax year, employers could only use voluntary payrolling if they registered before 6 April 2026. Certain benefits, including beneficial loans and employer-provided accommodation, still need to be reported on a P11D under the current system.

The rules are changing from April 2027, when most benefits in kind will have to be reported through payroll in real time. So, now’s a good time to check whether your payroll software and internal processes are ready.

Usually, the employee or director pays Income Tax on the taxable value of a benefit.

They don’t normally make a separate payment when the P11D is submitted. HMRC will often adjust their tax code so the tax is collected through PAYE. If the individual completes a Self Assessment return, they should also check that the benefit information is included correctly.

The employer is usually responsible for paying Class 1A National Insurance on taxable benefits. This is separate from the employee’s Income Tax and is reported through the P11D(b).

For more on how these costs work, read our guide to employer’s National Insurance.

You’ll generally need to file a P11D for each employee or director who received a taxable expense or benefit that:

• Wasn’t exempt from tax
• Didn’t qualify as a trivial benefit
• Wasn’t already taxed through payroll

If you’re a founder-director, your company may need to submit a P11D for you even when you’re its only employee.

For example, suppose your limited company pays for your private medical insurance and the benefit hasn’t been payrolled. The company would normally file a P11D showing the taxable value.

Sole traders don’t file a P11D for benefits they provide to themselves because they aren’t employees of a separate company. However, a sole trader who employs staff may need to submit P11Ds for those employees.

If you provide reportable P11D benefits to employees, you’ll need to submit a P11D for each affected person and provide them with a copy of the information.

You’ll also need to file a P11D(b) if your business owes Class 1A National Insurance.

If you didn’t provide any taxable benefits, or every benefit was exempt or correctly payrolled, you may not need individual P11Ds. But check whether a P11D(b) or another declaration is still required for your circumstances.

P11D and P11D(b) forms must usually be filed online.

You can submit them using:

• HMRC’s PAYE Online service
• Commercial payroll software that supports P11D reporting
• An accountant or payroll provider

Before filing:

1. Check which employees and directors received benefits.
2. Separate exempt, payrolled and reportable benefits.
3. Calculate the taxable value of each reportable benefit.
4. Complete a P11D for each relevant person.
5. Complete the P11D(b) for any Class 1A National Insurance due.
6. Submit the forms together and give each employee their information.

Tip: Remember to keep your calculations, receipts and supporting records in case HMRC asks how you arrived at the figures.

For benefits provided during the 2026/27 tax year, which ends on 5 April 2027, the P11D deadline is:

6 July 2027

You must submit your P11Ds and P11D(b) by this date and give employees details of the benefits reported for them.

Any Class 1A National Insurance must normally reach HMRC by:

• 19 July 2027 if paying by cheque
• 22 July 2027 if paying electronically

Put those dates in the diary. Late or inaccurate submissions can result in penalties, while late National Insurance payments may attract interest too.

Benefits in kind can be a great way to reward employees or structure part of a director’s remuneration. The important bit is understanding whether they’re taxable and making sure they’re reported in the right way.

Keep a record whenever the business provides something of personal value to an employee or director. Then, before the end of the tax year, check whether it is exempt, payrolled or needs to appear on a P11D form.

If you’re setting up a limited company, our company registration service can help you get started. Once you’re trading, a dedicated business current account can make it easier to separate your finances, track business expenses and keep the records you’ll need for payroll and tax.

For complicated benefits, company cars, accommodation or director loan arrangements, it’s sensible to check your calculations with an accountant.

Yes. In most cases, P11D and P11D(b) forms must be filed online using HMRC’s PAYE Online service or compatible commercial software. You can also ask an accountant or payroll provider to submit them on your behalf.

Submit the missing forms as soon as possible. Late P11D and P11D(b) returns can lead to penalties, and HMRC may also charge interest or penalties if Class 1A National Insurance is paid late. Contact HMRC promptly if you’re unsure what you owe.

Yes. If you notice a mistake after submitting, you can send an amended P11D or P11D(b) online. The amended form should show the corrected total figures, not simply the difference between the original and updated amounts.