P11D Avoidance Question

[tractor]

Dont want to repeat being a broken record but I dont want an accountant I want to do it myself - I'm an out of control freak!

FTFY

[Nixon Williams]

No.2 Are you saying that a P11D etc should be submitted even though no wages are being taken and no PAYE is operated? how would that be possible - without any PAYE ref? i.e. if the company is dormant?

Yes - the company should have had a PAYE scheme set up, and you will need one in order to submit a P11d.

A PAYE scheme does not just cover the taxation of salaries and wages, it also covers benefits in kind such as a company car etc.

Alan

[Podgy]

Yes - the company should have had a PAYE scheme set up, and you will need one in order to submit a P11d.

A PAYE scheme does not just cover the taxation of salaries and wages, it also covers benefits in kind such as a company car etc.

Alan

but you dont have to set up a payroll? in this case, the company had not - I discussed with hmrc notifying the company was dormant & no salary would be paid & should I submit P11D - as I could not without the paye ref I was told so long as its submitted in self-assessment I would not be liable to any penalty (he happily gave me his name as I was concerned it could bounce back at a later date). Not every Director receives a salary or is on the payroll - but may have benefits - so how are they supposed to be reported?

[Nathan SJD Accountancy]

Hi, The way they are reported is on the P11d.

As Alan says, the company needed to submit a P11d. If a benefit in kind is being provided, the company needed to pay Class 1A National insurance on that beneift to HMRC. The P11d is the document that informs them of this amount.

So while it is enough for the Director to include the benefits on his self assessment, the employer still needs to report such benefits and pay the Class 1A NIC.

[Podgy]

Hi, The way they are reported is on the P11d.

As Alan says, the company needed to submit a P11d. If a benefit in kind is being provided, the company needed to pay Class 1A National insurance on that beneift to HMRC. The P11d is the document that informs them of this amount.

So while it is enough for the Director to include the benefits on his self assessment, the employer still needs to report such benefits and pay the Class 1A NIC.

But the 'benefit' is used exclusively for business (or in this case was not actually being used at all as the director was out of the country) but theoretically it is 'available' as it was at the business premises. The mileage (or lack of) confirms this.

Are you saying that even though the company is dormant, the director is out of the country, & does not receive a salary - the company must tell HMRC that the director has company car benefit on a P11D form so therefore must operate a payroll purely to submit a form where no contributions are due?

[Mister Clark]

What part of 'get an accountant' don't you understand?

You think you're going to save money by not paying for one but you've probably already cost yourself more money than you stand to save.

Do yourself a favor, listen to the half dozen people who know more that you about the financial side of contracting than you and get an accountant rather than trying to get it for free by asking questions of strangers of a message board.

[Podgy]

What part of 'get an accountant' don't you understand?

You think you're going to save money by not paying for one but you've probably already cost yourself more money than you stand to save.

Do yourself a favor, listen to the half dozen people who know more that you about the financial side of contracting than you and get an accountant rather than trying to get it for free by asking questions of strangers of a message board.

Has'nt cost me anything - just a learning curve.

Thought thats what message boards were for!

[northernladuk]

Has'nt cost me anything - just a learning curve.

Thought thats what message boards were for!

They are not a replacement for doing it properly bearing in mind it is your neck that is on the line and could end up costing you more than you have.

[Old Greg]

They are not a replacement for doing it properly bearing in mind it is your neck that is on the line and could end up costing you more than you have.

But won't these threads be usable as evidence in court to demonstrate due diligence and absence of mens rea?

[Mister Clark]

Has'nt cost me anything - just a learning curve.

Thought thats what message boards were for!

Is that right?
Let us know how much the BIK is on your company car once you've worked it out.