Payrolling Benefits and Expenses

If you’re intending to payroll benefits and expenses, you must register for the service before the start of the tax year


What benefits can you payroll?


You can payroll all benefits except:

  • employer provided living accommodation

  • interest free and low interest (beneficial) loans

Any benefits that have not been payrolled must be reported on a P11D


Advising your employees

Once you’ve registered to payroll benefits, you must notify your employees that you’re payrolling benefits. You must also give your employees the following information before 1st June after the end of each tax year:

  • details of the benefits you've payrolled, for example, car fuel

  • the cash equivalent of each benefit you’ve payrolled

  • the relevant amount you’ve payrolled for optional remuneration

  • details of benefits you haven’t payrolled

It should be clear to the employees:

  • what benefits have been subject to PAYE tax

  • how much of the value of each benefit you’ve collected and reported tax on

What happens if you miss the deadline?

Unfortunately if you miss the deadline to register for payrolling benefits you will not be able to payroll any benefits until the following tax year and you will still be required to complete a P11D at the end of the tax year.


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