Resources

Confusion around P11D filing for non-salaried directors

Resources

Confusion around P11D filing for non-salaried directors

This page was last updated on November 3, 2023

Businesses sometimes assume that non-salaried employees aren’t required to submit a P11D – but that’s not the case if they gain other benefits from the employer.

In particular, business directors whose remuneration package involves a director’s loan account and its interest or benefits in kind (such as a company car or medical insurance) still need to complete a P11D even if they don’t receive a salary. This applies to limited companies, and also partners of LLPs.

Despite not paying them a salary, the businesses of those directors receiving other benefits are required by HMRC to:

Register them on their PAYE scheme
Set up a PAYE scheme (if one isn’t in place) for P11D purposes
Submit a NIL Employment Payment Summary (EPS) to HMRC by 19 May each year (to cover the new tax year). So a NIL EPS is due on 19 May 2024 to cover the 2024/5 tax year.
Include the directors in the P11D submission on 6 July each year.

This will help to prevent HMRC from issuing penalties and charging interest.

Changes in 2023

From April this year, HMRC withdrew the option for businesses to submit P11D and P11D(b) returns via hard copy paper forms. All returns must now be submitted using a new electronic form, and HMRC will reject any paper forms submitted.

Many businesses have been caught out in relation to submitting a NIL EPS and the new P11D filing regime. This has incurred charges and interest from HMRC.

Can we help?

Our Payroll Services team has been helping affected businesses in a number of ways. For example:

Setting the business up on PAYE for P11D purposes
Acting as their authorised representative with HMRC to negotiate withdrawing charges and interest caused
Submitting the NIL EPS in April to avoid HMRC penalties and interest charges
Advising on P11D and benefit-in-kind matters ahead of the 6 July filing deadline.

If your business has been affected or needs clarification on the P11D protocol for non-salaried employees receiving benefits, please speak with your Shipleys contact or one of our specialists shown on this page.

Specific advice should be obtained before taking action, or refraining from taking action, in relation to this summary. If you would like advice or further information, please speak to your usual Shipleys contact.