A complete employer guide to the P11D for 2025/26: which benefits must be reported, how to value them, the 6 July 2026 filing deadline, Class 1A NIC at 15%, and what the shift to mandatory payrolling from April 2027 means for you right now.
If you provide any taxable benefits to directors or employees, including company cars, private medical insurance, beneficial loans, gym memberships, or living accommodation, the P11D deadline should already be in your sights. For the 2025/26 tax year, all P11D and P11D(b) forms must be filed with HMRC by 6 July 2026. This guide covers everything you need to know, including what to report, how to value each benefit, and why the 2025/26 P11D is the last full year of traditional reporting before mandatory payrolling takes over in April 2027.
What Is a P11D?
A P11D is an annual return that employers must submit to HMRC for every director or employee who receives taxable benefits in kind (BIK) or reimbursed expenses outside of payroll during the tax year. The form tells HMRC the cash equivalent value of each benefit so that the correct Income Tax can be collected from the individual, usually through a tax code adjustment in the following year.
A separate form, the P11D(b), is the employer’s declaration of the total Class 1A National Insurance liability on all benefits provided. Both forms are due by 6 July 2026 for the 2025/26 tax year. Since 6 April 2023, paper P11D submissions have not been accepted. All forms must be filed electronically through HMRC’s PAYE Online service or recognised payroll software. Our payroll outsourcing service handles P11D preparation and electronic filing for employers across London and the UK.
P11D Deadlines for 2025/26
| Deadline | Date | What Is Required |
|---|---|---|
| File P11D and P11D(b) with HMRC | 6 July 2026 | Submit electronically via HMRC PAYE Online or payroll software |
| Give employees their P11D information | 6 July 2026 | Each affected employee must receive a copy by this date |
| Pay Class 1A NIC by cheque / post | 19 July 2026 | Payment must reach HMRC by this date if paying by post |
| Pay Class 1A NIC electronically | 22 July 2026 | Electronic payment must clear HMRC’s account by this date |
⚠️ Late Filing Penalties Are Automatic and Escalate Quickly
HMRC charges an automatic penalty of £100 per 50 employees for every month (or part month) that the P11D(b) is late. Late payment of Class 1A NIC attracts interest from the due date plus percentage-based penalties: 5% of the unpaid amount after 30 days, rising further at six and twelve months. For a business with 10 employees, a three-month delay on filing costs £300 in penalties before interest is added.
What Benefits Must Be Reported on a P11D?
The following are the most common taxable benefits that must be reported on a P11D. This is not an exhaustive list. HMRC’s full guidance covers over 40 categories of benefit and expense.
| Benefit | How It Is Valued for P11D |
|---|---|
| Company car (private use) | List price × CO2 emission percentage (varies 2%–37%) |
| Car fuel benefit | Fixed multiplier (£28,200 for 2025/26) × CO2 emission percentage |
| Company van (private use) | Fixed benefit charge of £4,020 per year (2025/26) |
| Private medical insurance (BUPA, AXA, etc.) | Cost to the employer of providing the cover |
| Beneficial loans (interest-free or low-interest) | Loan balance × official HMRC rate (3.75% in 2025/26) |
| Annual value of the property; higher-value properties use an additional charge | Gym memberships paid by the employer |
| Gym memberships paid by employer | Cost to the employer |
| Mobile phones (second phone; first is exempt) | Cost to the employer |
| Subscriptions and professional fees not wholly for business | Cost to the employer |
What Does NOT Need to Go on a P11D?
Not every benefit requires a P11D entry. HMRC provides a number of exemptions and trivial benefits provisions that reduce the reporting burden for many employers:
- Trivial benefits exemption: Gifts and benefits costing £50 or less per employee per occasion do not need to be reported, provided they are not cash or cash vouchers, not provided as a reward for services, and not a contractual entitlement. For close company directors, the annual cap is £300
- One mobile phone per employee: The employer can provide one mobile phone per employee with no benefit-in-kind charge
- Employer pension contributions: Contributions to a registered pension scheme are not a benefit in kind and are not reported on a P11D
- Staff parties: Up to £150 per head per year on qualifying annual events, such as a Christmas party, does not create a taxable benefit
- Workplace nursery: Childcare provided at an employer-operated workplace nursery is exempt
- Benefits covered by a PAYE Settlement Agreement (PSA): Minor or irregular benefits settled under a PSA are excluded from individual P11Ds
Class 1A NIC on Benefits in Kind: 2025/26 Rate
Employers pay Class 1A National Insurance Contributions on the total value of taxable benefits reported on P11D forms. For 2025/26, the Class 1A NIC rate is 15%, up from 13.8% in prior years following the Autumn Budget 2024. This increase applies to all benefits in kind, regardless of their category.
The calculation is straightforward: total the cash equivalent value of all benefits reported on all P11D forms for the year, and multiply by 15%. This figure is declared on the P11D(b) and must be paid to HMRC by 22 July 2026 (electronic payment) or 19 July 2026 (cheque).
The Biggest Change Coming: Mandatory Payrolling from April 2027
The 2025/26 P11D, due by 6 July 2026, is effectively the last full year of traditional P11D reporting for most employers. From 6 April 2027, HMRC is making payrolling of benefits in kind mandatory for all employers and almost all benefits. This means that instead of reporting benefits annually on a P11D, employers will be required to include the taxable value of benefits in payroll calculations each pay period, with Income Tax and Class 1A NIC collected in real time through PAYE.
Two categories are temporarily excluded from mandatory payroll: employer-provided living accommodations and beneficial loans. These will continue to be reported via P11D and P11D(b) after 2027 until HMRC extends the payrolling requirement to cover them. All other benefits, including company cars, medical insurance, gym memberships, and van use, must move to payroll from April 2027. Directors who receive benefits will also need to ensure their Self Assessment tax return reflects any changes to how benefits are reported.
ℹ️ Warn Employees About the Double Tax Risk in the Transition Year
Employees moving to payrolled benefits in 2027/28 may temporarily pay tax on two sets of benefits at once: the previous year’s benefits collected through a tax code adjustment, and the current year’s benefits collected through payroll in real time. This overlap is a known HMRC consequence of the transition and is not an error, but it can cause confusion and complaints on payday. Briefing affected employees now, before the change takes effect, avoids difficult conversations later. HMRC’s registration window for the mandatory 2027/28 payrolling regime is expected to open in November 2026.
P11D Checklist for the 2025/26 Tax Year
- List every benefit and reimbursed expense provided to each director and employee during 6 April 2025 to 5 April 2026
- Calculate the cash equivalent value of each benefit using HMRC’s valuation rules
- Check the trivial benefits exemption for any low-value items. Benefits of £50 or less per occasion may not need reporting
- Prepare a P11D for each affected director or employee and a single P11D(b) for the employer
- File electronically via HMRC PAYE Online or payroll software by 6 July 2026
- Give each affected employee a copy of their P11D information by 6 July 2026
- Calculate total Class 1A NIC at 15% on total benefit value and pay HMRC by 22 July 2026 (electronic)
- Begin planning for the transition to mandatory payrolling from April 2027: audit your benefits, update payroll software, and brief employees
P11D Deadline on 6 July — Is Your Payroll Ready?
Our payroll outsourcing service handles P11D preparation, Class 1A NIC calculations, and electronic filing for employers across London and the UK. Fixed fee, filed on time, every year.
View Payroll ServiceFrequently Asked Questions
What is the P11D deadline for 2025/26?
The P11D filing deadline for the 2025/26 tax year is 6 July 2026. Both the P11D forms (one per affected employee) and the P11D(b) employer declaration must be filed electronically with HMRC by this date. Each affected employee must also receive a copy of their P11D information by 6 July 2026. Class 1A NIC on benefits must be paid by 22 July 2026 electronically, or 19 July 2026 by cheque.
What is the Class 1A NIC rate for 2025/26?
The Class 1A NIC rate for 2025/26 is 15%. This rate applies to the total cash equivalent value of all taxable benefits reported on P11D forms. It increased from 13.8% following the Autumn Budget 2024. Class 1A NIC is an employer-only charge. Employees do not pay it on their benefits in kind.
Do I need to complete a P11D if my employees have no benefits?
No. You only need to submit P11D forms for employees or directors who received taxable benefits or reimbursed expenses during the tax year. If no employees received any benefits, no P11D or P11D(b) is required. However, if you previously submitted P11Ds and are no longer providing benefits, it is advisable to notify HMRC so they do not chase a nil return.
What happens if I miss the P11D filing deadline?
HMRC charges an automatic penalty of £100 per 50 employees for every month or part month the P11D(b) is late. In addition, late payment of Class 1A NIC attracts interest from the due date and escalating percentage penalties: 5% of the unpaid amount after 30 days, with further charges at six and twelve months. Missing the deadline can quickly become more expensive than the cost of the benefits themselves for small employers.
When is the payroll of benefits in kind becoming mandatory?
HMRC is making the payrolling of most benefits in kind mandatory for all employers from 6 April 2027. The 2025/26 P11D (filed by 6 July 2026) is the last full year of traditional P11D reporting for most benefits. From April 2027, employers must report and collect tax on benefits through payroll in real time each pay period, rather than annually via a P11D. Living accommodation and beneficial loans are temporarily excluded from mandatory payrolling.
Muhammad Bilal is a Fellow Chartered Certified Accountant (FCCA) and Director of Protax Consultants, a London-based accounting firm specialising in tax advisory, compliance, and business accounting services.
Bilal qualified with the Association of Chartered Certified Accountants (ACCA) in 2009 and later achieved FCCA status after gaining extensive professional experience. With more than 13 years of experience in accounting, taxation, and auditing, he advises SMEs, landlords, contractors, and charities on tax planning, compliance, and financial management.
As a registered HMRC agent, Bilal assists clients with Self Assessment tax returns, corporation tax planning, VAT compliance, payroll services, and HMRC enquiries.
Bilal holds a BSc (Hons) in Applied Accounting and leads the audit and compliance function at Protax Consultants.
Company Verification:
Protax Consultants Ltd – Company Number 14701253
View Companies House Record
