What employers need to know for the new tax year: employment tax filing obligations
There are a number of key tax changes and dates that employers need to keep in mind now we have moved into the new tax year. Here we have highlighted some of the important employment tax filing obligations that you should be aware of.
Annual return of expenses and benefits (form P11D)
All employers who provide their employees or directors with benefits in kind are required to report these annually to HMRC on forms P11D. There are two exceptions to this. If the employer wishes to pay the tax on behalf of their employees it is reported via a PAYE Settlement Agreement, or if an employer has already processed this voluntarily via payroll, no P11D is required.
If you have provided any benefits or reimbursed any non-business expenses, then you must complete a P11D for each relevant employee or director, as well as a form P11D(b) for the company. You will only be able to accurately calculate the Class 1A National Insurance Contributions (NICs) due on these benefits once the forms are complete.
Both forms must be submitted to HMRC by 6th July 2018 and any Class 1A NICs due must be paid by 19th July (or 22nd July if you pay electronically). There are penalties if you miss this deadline, as well as for incorrect or incomplete forms.
If you think there are any relevant benefits or expenses to report for your company and you would like us to complete these forms for you, then please get in touch.
Employment related securities (form 42)
Employers are required to make an annual report to HMRC when directors or employees acquire shares in a tax year.
You must use the online HMRC share schemes reporting facility to report any share related transactions, including share options provided or issued to employees or directors. This year, the deadline for reporting is 6th July 2018.
This includes events such as allowing employees or directors to acquire shares at market value (i.e. even if no tax in point), where you grant or exercise share options or where you buy shares from employees at more than the market value.
Any event in relation to an Enterprise Management Incentive (EMI) share option is reported on a separate online EMI return (as detailed below).
Employment management incentive (EMI) scheme annual return
The company secretary, or the person acting as the company secretary, must complete an online end-of-year return on or before 6 July for each registered EMI scheme.
Where there are outstanding qualifying options and there has been activity in the tax year, some details need to be completed.
You also need to complete an online ‘nil’ return if there are no outstanding qualifying options but you have registered the scheme, or there are outstanding qualifying options but there has been no activity in the tax year.
Hence, any company with an EMI scheme will need to complete the annual compliance return.