Each year employees who have employee benefits and or expenses paid for by the employer require a form P11D to be prepared by the employer. In many cases a dispensation is obtained from HM Revenue and Customs. This may no longer be the case from 5 April 2015. There may be no need to apply for dispensation although P11Ds will be required where expenses are taxable.
Whereas currently with no dispensation all expenses go on a P11D and a claim is made that some or all of these were incurred wholly, exclusively and necessarily for the business. Employers will have to decide whether the expense is taxable or not on the employee and subject to National Insurance. This is all part of tax simplification. Howr employers are expected to get this right when even trained HM Revenue and Customs Inspectors sometimes get this wrong we do not know. This is a recipe for problems in the future when an Inspector visits and picks up expenses that should have been put on a P11D and penalties and interest will be incurred. It also seems that the £8,500 limit below which no P11D is required is also likely to go. So watch this space. The Revenue claim it will save administration but it is hard to see how employers will be saved any administration. It just creates more uncertainty.
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