2024/25 Employer Guide: How to Report Taxable Expenses and Benefits

Understanding Your Reporting Duties

As an employer, if you’ve provided taxable expenses or benefits to your employees during the 2024/25 tax year, it’s essential to fulfil your reporting responsibilities. These include submitting the necessary information to HMRC and ensuring employees receive the relevant details. Your exact obligations will depend on whether or not you’ve chosen to payroll these benefits.

If You Used Payrolling for Benefits

When benefits are taxed through the payroll (a process known as payrolling), most of your reporting happens in real time throughout the tax year. However, there are still important steps to take after the year ends:

• Informing Employees: By 1 June 2025, you must provide each employee with a breakdown of their 2024/25 payrolled benefits. This can be shared via email, a formal letter, or even on their payslip.
• Filing Class 1A NIC Returns: You must still file a P11D(b), which details your Class 1A National Insurance liability—even if all benefits have been payrolled. The return must include all payrolled benefits and be submitted online (via PAYE Online for Employers or approved commercial software) by 6 July 2025.

Reporting Non-Payrolled Benefits

For taxable benefits that weren’t payrolled or aren’t part of a PAYE Settlement Agreement, the process is slightly different:

• Form P11D: Each benefit provided must be reported to HMRC on a P11D form. These must be submitted online by 6 July 2025, either through HMRC’s PAYE Online for Employers (only if you have fewer than 500 employees) or commercial payroll software. Paper forms are no longer accepted.
• Form P11D(b): Alongside the individual P11Ds, you also need to file a P11D(b) online. This confirms that all relevant P11Ds have been submitted and declares your Class 1A NIC liability. Be sure to include all taxable benefits—whether payrolled or not—in this calculation.
• Employee Notifications: You must give employees details of their reportable benefits by 6 July 2025. Providing a copy of their P11D is the simplest option, but an email or a letter is also acceptable.

Stay Compliant and Avoid Penalties

Meeting these deadlines is crucial. Missing deadlines or submitting inaccurate returns can lead to penalties, which can be significant depending on the nature and scale of the errors.

Supporting Regulations

This guidance aligns with the following legislation:

• Income Tax (Pay As You Earn) Regulations 2003 (SI 2003/2682), regs 61M, 85, 86, 87
• Social Security (Contributions) Regulations 2001 (SI 2001/1004), reg. 80

Ensuring accurate and timely reporting of benefits keeps your business compliant and employees informed. With the 6 July deadline approaching, early preparation is key.

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