Many employers made unusual or special payments to employees because of homeworking or other coronavirus-related reasons during 2020/21. The question is, should they be reported on Form P11D?

Deadlines and forms

The deadline for submitting benefits and expenses returns for 2020/21, Form P11D , is 6 July 2021. Whether you still have this arduous task to complete or have submitted your forms it’s worth sparing a few minutes to make sure that any out-of-the-normal expenses payments related to the pandemic have been dealt with correctly.

Tip. If you’ve already submitted your P11Ds and need to correct one or more of them, it’s best to do this before the deadline but can be done later if necessary. You must include all the benefits and expenses, not just the ones you want to change.

Reportable or not

Coronavirus-related expenses paid to your employees or benefits you provided them with in 2020/21 might be exempt from income tax and NI and therefore not reportable on Form P11D . For example, you provided a normally office-based employee with a mobile phone so they could make business calls when they worked from home. Other expenses and benefits are reportable but the employees might be entitled to claim a tax deduction; that’s entirely up to them.

Non-reportable benefits and expenses

The following benefits and expenses do not need to be reported to HMRC:

  • a mobile phone that you contracted and paid for and provided for business or private use
  • the cost of a broadband service if the employee did not already have a private contract for it, and it was needed for homeworking
  • equipment, e.g. a computer, provided for business use (even if there is some private use)
  • reimbursing an employee the cost of office equipment they bought because they were required to work from home because of the pandemic
  • payment or reimbursement of the cost of coronavirus antigen tests
  • providing or reimbursing an employee the cost of personal protective equipment needed for their job
  • payment of up to £6 per week towards extra household costs where you agreed with the employee they could work from home.

Reportable benefits and expenses<h/2>
The following do need to be reported:

  • a payment which is in excess of £6 per week towards extra household costs where you agreed the employee could work from home
  • payment for accommodation, e.g. a hotel, where an employee self-isolated away from home
  • providing transport for an employee to travel between their home and their normal workplace (unless their home has also become a normal workplace)
  • accommodation expenses if an employee was unable to return home after a business trip.

More information. The lists above aren’t exhaustive. If you provided a benefit or paid expenses to an employee because of the pandemic and aren’t sure if you should be reporting them on Form P11D HMRC has a couple of guides that might help (see The next step ).Not all benefits provided and expenses paid by employers because of the pandemic are tax exempt, e.g. home broadband costs where an employee already had a broadband service. These must be reported on Form P11D. Most benefits and expenses linked to homeworking, e.g. the provision of equipment, don’t need to be reported.

The next step

Check which expenses are taxable if your employee works from home
Free or subsidised meals

This article has been reproduced by kind permission of Indicator – FL Memo Ltd. For details of their tax-saving products please visit www.indicator-flm.co.uk or call 01233 653500.