Employee benefits reporting

P11D Expenses and Benefits

By law, at the end of each tax year you must provide HMRC particulars of any expenses payments, benefits and facilities provided to employees, unless:

  • There are no expenses payments or benefits to be returned,
  • They are covered by a PAYE settlement agreement or
  • A dispensation has been given by an Officer.

Selenity Expenses collects the information required by assigning a P11D category to an expense item. All expenses incurred against that expense item are collated behind the scenes on a per claimant basis.

PAYE Settlement Agreement

If an organisation is operating with a PAYE Settlement Agreement (PSA) they will spend time reviewing finance systems to identify taxable costs from expenses and benefits including staff entertaining, meals and travel and subsistence expenses. This being to help simply the process of calculating and paying any PAYE and NICs due to HMRC with a single payment, which would typically be payable by the employee.

What should be included in the PSA?

There is no need to include in a PSA items that don't attract any tax or NICs liabilities, but determining this can often be time consuming and confusing. For instance a common error is treating minor and trivial costs. You don’t have to include flowers for a birthday or an employee in hospital. However flowers as rewards are taxable. Another inaccuracy can be staff entertaining, when really they qualify as subsistence.

How will Selenity Expenses help me?

The expense items that need to be reported for PSAs can be collected and reported on effortlessly through Selenity Expenses expenses management software. Using a Reason classification is a simple way to report expenses for particular events. This will easily allow you check the number of attendees that were present at a function to establish if the exemption rule applies before including in the PSA.

Another way is to capture specific expenses or benefits which are irregular. This could be a nonqualifying company party or taxable event, or taxable relocation costs where the costs exceed £8,000.

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