2026 – The last P11D’s – what happens next?

2026 – The last P11D’s – what happens next?

As HMRC moves to payroll filing of expenses and ‘benefits in kind’ from the new tax year, this July will be the last P11D deadline for many employers.

What is a P11D?

A P11D is a UK tax form employers use to report certain employee benefits and expenses to HMRC.

Typical items reported on a P11D include:

• company cars and fuel,
• private medical insurance,
• interest-free or low-interest loans,
• accommodation,
• gym memberships,
• non-cash perks (“benefits in kind”).

The form shows the taxable value of those benefits for a tax year (6 April to 5 April). HMRC then uses it to calculate any extra Income Tax you owe. Employers may also pay Class 1A National Insurance on the benefits.

For those employers who do not get payroll expenses and benefits, the deadline for reporting P11D(b) Class 1A National Insurance contributions (NICs), P11D expenses and benefits in kind provided in the tax year 2025-26, is Monday 6 July 2026.

All P11Ds and P11D(b) for the tax year 2025-26 must be filed online and at the same time. 

Late submission may result in a penalty. HMRC charge penalties on a monthly basis and issues penalty notices each quarter until a return is received.

Under the new rules, from 6 April 2027 it will be mandatory to report and pay income tax and Class 1A NICs on benefits in kind (BIK) through payroll software.

A pilot programme has been running to iron out any complexities and the system will go live for all employers for the new tax year and HMRC has seconded a payroll expert!

For those companies still filing expenses reports using the traditional P11d method, HMRC has issued a reminder about the process and requirements.

Tips for the current system 

Employers must submit a P11D(b) form if they: 

• submitted any P11D forms; 
• paid any employees’ expenses or benefits through payroll;
• HMRC has asked an employer to file a P11D(b) form, by sending them a notification to do so. 

The P11D(b) form tells HMRC how much employers’ Class 1A NICs need to be paid on all the expenses and benefits provided to employees through payroll, as well as any reported to HMRC on a P11D form. 

For the 2026-27 tax year, any employer not registered to payroll Benefit in Kinds as part of the pilot, must continue to report employee benefits using:

• P11D for each employee receiving a benefit;
• P11D(b) to report Class 1A NICs.

These forms must be submitted by 6 July 2027 following the end of the tax year (5 April 2027), in line with the current process.

Nothing to declare

Employers only need to make a declaration if they have been asked by HMRC to submit a P11D(b) and they have nothing to declare.

It is only necessary to tell HMRC if the employer was sent an electronic notice from HMRC to file a P11D(b) or a reminder to file a P11D(b) letter. There is a form to let HMRC know this.

In order to make the transition as smooth as possible, HMRC is making every effort to ensure information is available at an early stage with ‘interim guidance’ available.

Two items will not be brought into the payrolling system initially and these are beneficial loans and living accommodation, but it should be possible to voluntarily report these.

A new registration service is being developed for those employers wishing to voluntarily payroll employment-related beneficial loans and living accommodation. ‘Details will be provided later this financial year,’ HMRC confirmed.