The deadline is fast approaching for employers to get ready for HMRC’s Payrolling Benefits in Kind (PBiK) scheme. From Richard Britten, Partner and Head of Employer Solutions Johnston Carmichael.
The system, introduced by HMRC last year, could help to simplify the processing of employee benefits. Benefits in kind are benefits that employees receive that do not come in the form of payment including gym memberships, company cars and private medical insurance.
Employers will be able to choose which benefits to payroll. Richard Britten said: “Payrolling Benefits in Kind has been designed to simplify the process and ensure an employee pays the correct amount of tax, at the correct time through their employment income, rather than wait for it to catch up after the end of the tax year.
Employers who register with HMRC to use payrolling Benefits in Kind will identify the type of benefits and employees who are to be included in the process, meaning they don’t have to report these on a P11D form. This reduces the administrative burden on employers and ensures that employees are appropriately taxed. To make use of the streamlined system, employers must register by 5 April 2017, for the upcoming tax year.
