P11D Amount made good

[xoggoth]

I note online that if an expense is a legit business one a lot of people put the same amount in the "Amount made good" box. "Made good" usually means repaid in some way as this HMRC ref says:

Class 1A National Insurance contributions: Calculating Class 1A NICs: Amounts made good by the employee: General

An employee may make good the cost of a benefit by
•a direct payment
•by a deduction from salary
•by a debit to the director’s loan account.

It is not necessarily a good thing to have no "taxable payments". If they are in section N they should be valid expenses anyway. In past I have had my tax code increased by this amount.
What do others do?

PS Changed reduced to increased. Same thing really in a circular universe.

[Martin at NixonWilliams]

I note online that if an expense is a legit business one a lot of people put the same amount in the "Amount made good" box. "Made good" usually means repaid in some way as this HMRC ref says:

Class 1A National Insurance contributions: Calculating Class 1A NICs: Amounts made good by the employee: General



It is not necessarily a good thing to have no "taxable payments". If they are in section N they should be valid expenses anyway. In past I have had my tax code reduced by this amount.
What do others do?

Unless you have done one of the 3 methods as you outline above you won't have 'made good' the expense and therefore no entry should be made in this section of the P11d.

The 'made good' is generally used where employees contribute towards the costs of actual benefits they are receiving i.e. towards running costs of a company car. It is not normally used to make good expenses that would not be taxable on the employee i.e. legitimate travel expenses.

Provided the expenses are not taxable and are genuine business expenses they when completing your tax return they will be declared in box 16 and also boxes 17-20 (expense category dependant) and contra each other off so no tax charge will arise.

If your tax code is amended a simple phone call to HMRC should resolve this.

Martin

[xoggoth]

Cheers Martin. Beats me why there is not some simple help on the form.

PS I meant to say I have had my tax code increased by this amount, ie having taxable expesnes on section N of a P11D is a good thing.

[Martin at NixonWilliams]

Cheers Martin. Beats me why there is not some simple help on the form.

PS I meant to say I have had my tax code increased by this amount, ie having taxable expesnes on section N of a P11D is a good thing.

HMRC aren't known for making things easy!

Just watch out it your tax code is increased incorrectly though, you could end up underpaying tax via PAYE and have a nasty tax bill when completing your self-assesment.

Martin