As a UK business, you must record all benefits offered to your employees as part of their overall remuneration package and submit them to HMRC to determine the Benefit-in-Kind (BIK) tax due.
Currently, you have the option to submit P11D forms online at the end of the tax year or to report taxable benefits via the Pay as You Earn (PAYE) scheme. The latter will become the mandatory way of reporting benefits from 6 April 2027 – the Government pushed this deadline back a year (from April 2026) to allow employers more time to prepare for the change.
In this guide, you’ll learn about what P11D is, the process options and frequently asked questions.
What is a P11D form?
Company benefits include everything from vouchers and company credit cards to accommodation, mileage allowance payments not taxed at source, interest-free loans, private medical insurance, and, of course, any type of car benefit.
A UK business that provides any of these benefits to its employees must file a P11D form in line with the submission deadline, which is always 6 July for the previous tax year.
On the form itself, for company cars, you’ll be asked to complete the following details for all employees: the make and model of the vehicle, the registration date, the CO2 emissions, the engine size, the fuel type, the list price of the car and any accessories added.
You’ll also need to state the amount of private fuel benefit, and include any contributions made by your employees for private use, accessories or fuel.
Let’s look at different car benefits and what reporting is required for each. If you choose to offer Salary Sacrifice Cars or Business Car Leasing, you’ll need to complete a form for every employee who has a company car or opts into an employee car benefit.
However, if you choose an Employee Car Ownership Scheme (ECOS), reporting is significantly reduced or can sometimes be removed.
Compare car benefit solutions in our blog: Which Car Solution is Right For Your Fleet?’.
P11D form vs P11D value
When you search for P11D, you might also encounter value and form, so what’s the difference?
The form is simply the way to record and report all benefits you provide to your employees to HMRC to determine the BiK tax due.
The value refers specifically to the car’s value, which is required to calculate the tax your employees must pay for their car benefit. The tax they pay will differ depending on the vehicle they have chosen or are given by the business, and their income tax rate.
The value is the list price of the car, including VAT, delivery charges, and any extras, but exclusive of the first registration fee and the first year of road fund licence.
The sum to work out how much the BiK tax is due is:
P11D value x BiK percentage rate x income tax rate of the employee.
Find accurate BiK rates for the current tax year using the UK Government page: ‘work out the appropriate percentage for company car benefits.
You can also find out how recent tax increases will impact employee benefits in our blog: Tax changes from April 2025.
The filing process
If you don’t pay expenses and benefits through payroll, allowing your employees to pay tax on them throughout the year, you must submit a P11D form to HMRC online.
Complete the form for each employee. If you have fewer than 500 employees, fill in and submit the forms through HMRC’s PAYE Online service.
If you have over 500 employees, complete the forms through your payroll software.
The deadline for completing the forms is 6 July, after the end of the tax year you’re reporting on
You also have the option to report taxable benefits via the Pay as You Earn (PAYE) scheme, which removes the need to file P11D forms. You need to register online before the start of the tax year you want to pay for. Next, you add the cash equivalent of the employees’ benefits to their pay and then tax them through your payroll.
Do I need to file any more forms?
In addition, you must also submit an online form to HMRC at the end of the tax year for any Class 1A National Insurance you owe. This is called a P11D(b).
If you make any errors with your forms, you should report them immediately to HMRC to avoid penalties.
The deadline for completing P11D(b), which details the business’s Class 1A National Insurance Contributions, is 22 July after the end of the tax year.
If the form is late, you’ll be charged a penalty of £100 per 50 employees for each month or part-month over the deadline. You’ll also be charged penalties and interest if you’re late making the payment to HMRC.
If you change the way you report taxable benefits to HMRC, you must inform your employees. Even if you use the PAYE scheme for your employees, you still need to complete the P11D(b) for the business.
In addition to this, you also need to complete a P46(car) form every time an employee goes into or changes their company car. You need to submit this to HMRC through payroll software. The P46(car) form is to let HMRC know that the employee is driving a company car so that they can update the employee’s tax code.
How to calculate P11D value
When calculating a car’s P11D value, you’ll need to use cap hpi data or similar to find the list price, which is inclusive of VAT, delivery charges, and any extras but exclusive of the first registration fee and the first year of road fund licence.
Once you have the value, you can calculate the tax your employees must pay for their car benefit. It will differ depending on the car they choose or are given from the business, and their income tax rate. The sum to work out how much the Bik tax is due is:
P11D value x BiK percentage rate x income tax rate of the employee.
Common mistakes
Errors in filings can lead to delays and potential issues. Common issues include the form being submitted more than once by mistake, using the wrong form for the reporting tax year, leaving sections such as cash equivalent or fuel benefit blank, or incorrectly reporting how vehicle use is split between business and private.
Ensure you complete all areas of the form; your employee reference numbers are critical for HMRC to identify each individual, so this information needs to be accurate. The correct value of the car is another vital data required, as is completing the total cash equivalent of cars and car fuel provided.
You can contact the employer helpline if you have any problems completing your forms.
Alternatively, you can find the full range of HMRC booklets, forms and guidance:
P11D FAQs
Does the P11D value of a car decrease?
No, a car’s P11D value doesn’t decrease as it ages, it remains the same.
Can I amend a submitted form?
You can submit a correction form to amend or fix an error.
When is it due?
The deadline is 6 July after the tax year you’re reporting on.
When are they issued?
It should be available to your employees at the end of the tax year, however, since the business has until the deadline of 6 July, it could be closer to the latter date before you issue them.
How can I save time on reporting?
Consider switching to an Employee Car Ownership Scheme (ECOS). ECOS can significantly reduce or even eliminate the need for reporting. This is because the employee owns the car, removing it from company benefit status and cutting down on admin time and associated taxes.
Your business can streamline processes and free up valuable resources by choosing the right car benefit solution. Read our blog: Owning vs an ECOS Fleet to discover the pros and cons of ECOS.
Make reporting easier with ECOS
This is in contrast to traditional company car options like Salary Sacrifice or Business Car Leasing, which require a P11D form for every participating employee.
We have an alternative way to provide a car benefit that reduces or removes P11D reporting.
An Employee Car Ownership Scheme transfers the car’s ownership to your employees by selling the vehicle to them using a Credit Sale Agreement (CSA). The car is no longer classed as a company car, so your employees don’t pay BIK tax, and you don’t owe Class 1a National Insurance Contributions (NICS) on the benefit either.
For more information about ECOS and how it works, or get in touch with us today.