P11D Calculator

One of the most difficult tax forms for an employer to file is the P11D simply because there are so many rules, contingencies, dispensations and to put it bluntly, red tape. Along with the fact that HMRC are quite strict about when this form must be filed, 6 July following the end of the previous tax year, they impose high penalties if it is not filed timely or correctly. Although a P11D Calculator can help employers calculate expenses and allowances to be entered on the employee’s P11D, it will take some doing to figure out what needs to be declared and what doesn’t.

Before Using a P11D Calculator

Before using a P11D calculator, it would be in your best interest to read through the pamphlets and publications offered freely at the HMRC website. This literature will help you understand what you need to declare and what can be omitted. Suggested reading would include:

  • HMRC P11D Guide
  • HMRC Booklet 480 on Expenses and Benefits
  • Leaflet CWG5 on NI Contributions on Benefits in Kind
  • HMRC Booklet 490 on Employee Travel

This information should give you a fairly good understanding of what you should be itemising on the P11D. Keep in mind that filing late could result in a £300 fine whilst another £60 per day penalty could be tacked on for every day you fail to file or for filing incorrectly. This is why having a P11D calculator on hand can be a figurative lifesaver.

Common Expenses to Claim on an Employee’s P11D

Although this is by no means an exhaustive list, there are certain expenses which must be entered on an employee’s P11D if they can be considered taxable. Travel is probably the biggest category filed most of the time and there are a number of sub-categories to look at. For example, although there is a ‘general expenses allowance’ excluding entertainment, other expenses not included in the general expenses allowance would include such things as fares, meals, hotels, entertainment, and even travel between home and the employee’s permanent place of employment. However, this is just an example of the expenses and benefits which must be declared as there are a number of other categories which must be understood as well.

Using a P11D Calculator

Each P11D calculator will be a bit different but you will find they are an invaluable resource when it comes time to file forms for your employees. You can easily find one online and all you need to do is fill in the information asked for on each expense or allowance. The P11D calculator does the rest. For instance, you will probably be asked when the benefit was made available and the date it ended. It is usually worded “available from” and “available to.” Keep in mind that the dates entered must be within the same work year.

Next you will need to assign a cash value equivalent for the benefit or expense and then all you need to do is hit the ‘calculate’ button. There will be two different results on the bottom of most calculators, one that tells how many days the benefit was available with the value to be declared and the next line will say how many days of the year the benefit was unavailable and the corresponding cash value.

A P11D calculator is not difficult to use, the problem is in knowing what you need to declare for your employees. With the above mentioned literature and a handy online P11D calculator, filing timely and accurately should not be a problem.

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