Don't be exposed to P11D problems

Date: 30/05/14

Don't be exposed to P11D problems

Employers are warned about potential problems they may face filling in P11D forms.

Employers are required to submit P11D forms for each employee they have provided benefits or expense during the tax year.

Forms must be filed by July 6, setting out the full facts of each employee and the benefit in kind they have received, together with any expenses.

Employers need to ensure they can precisely establish the facts that need to be entered onto each form to avoid penalties for incorrect filing.

The importance of correctly filing P11D forms should not be overlooked.

It may seem an easy option to simply copy figures from previous years’ P11D forms if you believe nothing has changes, but this might just be storing up problems for the future.

Many clients have difficulties in areas including the provision of vehicles, cars or vans, particularly deciding whether a vehicle is a pool vehicle or a company car.

If a vehicle is a pool vehicle, there must be evidence to prove this. If a vehicle is incorrectly identified as a pool vehicle, and this is not reported on P11D, then this could have serious consequences.

HMRC could, for example, seek to collect the unpaid tax, while also seeking Class 1A NICs, interest and penalties.”

Other areas that could prove difficult for companies including interest free loans, particularly forgetting about overdrawn directors loan accounts.

If you need help filing P11D forms, it is also best to seek professional advice.For further information, please contact Tim Preece at the office.

Tim Preece FCCA

Author: Tim Preece FCCA

A former pupil at Lancaster Royal Grammar School, Tim joined Scott & Wilkinson in 1992 as a trainee after completing a degree in Maths and Economics at Leeds University and qualified as an Accountant in 1996. Tim was...

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