P11D, once and for all

[ittony]

I seems hardly a day has gone by this week without someone contracting a parallel thread about what goes on a P11D. For example:

If you pay for something for your business from your personal account, your company can reimburse you via cheque or bank transfer without any personal tax implication (i.e. you don't need to put it on your P11D), just record it in your company accounts (spreadsheet/book/fag packet) and keep a receipt as proof.

vs.

The problem with expenses being reimbursed from your personal a/c is you have to fill out a P11D and submit to HMRC with all of these on.

Does anyone know definitively what goes on a P11D?

[Bluebird]

If you as an individual recieve any payments in the form of reimbursed expenses, then these have to accounted to HMRC via the P11D form - simple as that.http://www.hmrc.gov.uk/guidance/p11dguide.pdf

[ittony]

If you as an individual recieve any payments in the form of reimbursed expenses, then these have to accounted to HMRC via the P11D form - simple as that.http://www.hmrc.gov.uk/guidance/p11dguide.pdf

So, what basshead said was wrong, and absolutely anything I pay for from my personal account which the company reimburses me for - must be listed on a P11D and then be cross-referenced on my self assessment, and this includes all of the following:

Buying a fax machine
Buying a ream of A4
Hiring a projector
Subscribing to MSDN
Joining the PCG
Hosting the company web site
Paying a subcontractor
Buying insurance
Taking a train to a meeting
Hiring an accountant

[xoggoth]

As I understand it, P11D is for those items that are potentially benefits in kind, travelling, subsistence etc. and things like hotel bills should be included even if paid from the business account.

Major company expenses like accountant or business insurance are best paid from the company account in any case to keep the accounts simple. If something like printer paper is used 100% for the business I don't think it is relevant that you paid for it out of the your own money and I would not include this on P11D. It is perfectly legitimate for a company to have a petty cash account for small things anyway.

It's all there in that link bluebird supplied.

[cojak]

My accountant sorts my P11D out for me.

HTH

[Bluebird]

As I understand it, P11D is for those items that are potentially benefits in kind, travelling, subsistence etc. and things like hotel bills should be included even if paid from the business account.

Major company expenses like accountant or business insurance are best paid from the company account in any case to keep the accounts simple. If something like printer paper is used 100% for the business I don't think it is relevant that you paid for it out of the your own money and I would not include this on P11D. It is perfectly legitimate for a company to have a petty cash account for small things anyway.

It's all there in that link bluebird supplied.

HMRC would argue that it's their decision whether there is any BIK not yours - in your example printer paper could be used for both business & personal use, therefore you have to declare that it's all business, you can't just say "I didn't include because it was 100%"

[xoggoth]

So where would printer paper be covered in that link you have provided bluebird?

[Bluebird]

"By law, at the end of each tax year you must

give HMRC particulars of any expenses

payments, benefits and facilities provided to

• each employee or director earning at a rate

of £8,500 a year or more"

AND

"Other expenses

Enter details of expenses incurred in, or in

connection with, the provision for the

director/employee of any benefits or facilities

of whatever their nature not returned under any other heading"

[philip@wellwoodhoyle]

Get a dispensation from HMRC and you don't have to report the reimbursements on the P11d, just the taxable benefits in kind. If you have no dispensation, then everything you pay privately and are reimbursed for by the company MUST be declared on the P11d and must be shown as both payments and expenses (to cancel eachother out) on your personal tax return.

[Bluebird]

Get a dispensation from HMRC and you don't have to report the reimbursements on the P11d, just the taxable benefits in kind. If you have no dispensation, then everything you pay privately and are reimbursed for by the company MUST be declared on the P11d and must be shown as both payments and expenses (to cancel eachother out) on your personal tax return.

Thanks Phil - whats the likelyhood of a small company getting dispensation - I thought this sort of thing they only gave to the big companies [ brollies / accountants ] etc.