Employee expenses and benefits provided in the year to 5 April 2021 must be reported to HMRC by way of the P11D process by 6 July 2021. Every employee who received benefits or expenses in the year should be included in that process even if they have already left the company.
Employers who have already accounted for the value of the benefits during the payroll process do not have to complete a P11D for those employees but must submit a P11D(b) to HMRC to report the class 1A NIC which is due.
Many employees were provided with extra support from employers in 2020-21 to enable them to work in a covid-secure way. HMRC introduced some concessions to ensure that employees are not taxed on the benefit of this necessary support.
Where the employee was required to work at home as the workplace was closed or they had to self-isolate, the following costs are not treated as taxable benefits if met by the employer:
- broadband internet connection if it was not already available;
- computer tablet, laptops and office supplies;
- reimbursing employee for the cost of home office equipment; and
- working at home allowance up to £6 per week.
Strictly there should be no significant private use of the broadband and equipment to allow the provision to be tax free but HMRC says that the private use measure should be based on the employee’s duties and the need for them to have the equipment or services provided to do their job.
We are able to help deal with P11D and P11D(b) filing and advise on what costs should and should not be included.