P11D: HMRC no reporting requirements vs personally expensed and reimbursed items

[Clare@InTouch]

The £3 a week is the HMRC guide rate for a claim that shouldn't be questioned. You can claim above that amount if you can justify it - for example by calculating your total household bills, the floor area of your house and apportion the costs to the space used by the business (adjusting for the actual hours used rather than 24 hours a day 7 days a week).

Specific deductions: use of home: examples

[richy]

Last year, I asked my accountant to clarify which items should be included on my P11D and gave her a list of items I had claimed expenses for during the year.

If like us, your ltd co have no B.I.K. (Benefit In Kind) you simply need to fill in the exception form P11Dx on HMRC site and post that in to your HMRC PAYE office. This is what our ltd co have to save paperwork for our staff who only receive reimbursements for biz trips wholly and necessarily incurred etc.

Cheers, richy

[xoggoth]

Beats me how anyone can read HMRC's guidance pages and have a clue sometimes. Some pages say you can claim for business usage of personal phone and broadband, some seem to say you can't. My own business use of broadband is trivial but my sister uses hers entirely for business and only got it for that purpose.

I think "wholly and exclusively" is often misunderstood to mean something has to be totally used for business or you can't claim anything. In fact, if you can apportion the business element you can.

The general rule for employees’ expenses: wholly and exclusively

[SueEllen]

My very first accountant told me to claim £10 a week and I've been doing that ever since!

Different accountants will tell you to claim for use of home office in different ways so I wouldn't panic.

[ladymuck]

... and £3 per week for use of home ...

My very first accountant told me to claim £10 a week and I've been doing that ever since!

[Bob Jones]

If you make payments that are truly a compnany liability these payments do NOT appear on the P11D - see Employment income: expenses payments and reimbursements

In particular

Businesses are often run in such a way that employees make payments on their employer's behalf. For example an employee may buy stamps for the employer and be paid from petty cash. This transaction is outside the scope of Section 62 and Section 72: the employee has received no money of his own on which we could make such a charge.

Bob

[xoggoth]

What on earth is section N? It isn't on the online form.

PS Oy yes it's the last "other" bit.

[Clippy]

Yes, but they will go in the "non-taxable" part of the form - section N.

Appreciate the confirmation - always handy to have a second opinion when in doubt.

[Clare@InTouch]

This is where I was coming from as this is what HMRC did last year and I'm still trying to sort it out.

So, is my accountants original advice correct?

i.e. "I can confirm that you will need to include... any expenses that you have personally paid for and that have been reimbursed to you from the company on your P11D."

Yes, but they will go in the "non-taxable" part of the form - section N.

[Clippy]

You still have to declare it on the P11D but there is no tax or NI liability. This is where coding notices often go wrong - HMRC see the entry in box N which should make it tax free, but transfer it incorrectly to their systems and it appears on your next coding notice as taxable (hence reducing your tax code). It's simple to correct them, but annoying nonetheless.

This is where I was coming from as this is what HMRC did last year and I'm still trying to sort it out.

So, is my accountants original advice correct?

i.e. "I can confirm that you will need to include... any expenses that you have personally paid for and that have been reimbursed to you from the company on your P11D."

[Clare@InTouch]

However, upon review prior to completing this years P11D, this seems to contradict HMRC guidance for some of the items which have no reporting requirements - e.g. stationery.

Does the fact that I personally paid for company expenses and my Ltd reimbursed me override HMRC's 'no reporting necessary' guidance (for relevant items)?
Doesn't seem logical to me as the method of payment should be irrelevant.

The bit you've linked to just states there are no reporting requirements if you provide stationery to your employees for business purposes. Have a read through the link below which is related to repaying your employees when they have incurred and been repaid for business expenses:

HM Revenue & Customs: Expenses payments

You still have to declare it on the P11D but there is no tax or NI liability. This is where coding notices often go wrong - HMRC see the entry in box N which should make it tax free, but transfer it incorrectly to their systems and it appears on your next coding notice as taxable (hence reducing your tax code). It's simple to correct them, but annoying nonetheless.

[xoggoth]

I have always taken it that you report things that are potentially a benefit to yourself, not things that truly are company items but which for some reason you have paid yourself. I had to pay for my small company's website hosting this year because the idiots do not take debit cards but I wouldn't consider that should go on P11D, there is nothing on it the site that is of any personal benefit.

Ps Thanks for reminding me it's £3 for heat and light, I had forgotten and was just about to submit mine with £2.

[Clippy]

Last year, I asked my accountant to clarify which items should be included on my P11D and gave her a list of items I had claimed expenses for during the year.

She came back and advised:

"I can confirm that you will need to include all benefits that you have received from the company and any expenses that you have personally paid for and that have been reimbursed to you from the company on your P11D. Therefore, you will need to include all of the below items you have listed if you have personally paid for them and the company have reimbursed you. However, please note that you do not need to include the mileage or use of home allowance if you are claiming the standard allowances of 40p per mile for mileage and £3 per week for use of home".

As I do not have a company credit or debit card, I pay for all my expenses personally and reimburse myself monthly so based on the above advice, I needed to declare all of my expenses on my P11D.

However, upon review prior to completing this years P11D, this seems to contradict HMRC guidance for some of the items which have no reporting requirements - e.g. stationery.

Does the fact that I personally paid for company expenses and my Ltd reimbursed me override HMRC's 'no reporting necessary' guidance (for relevant items)?
Doesn't seem logical to me as the method of payment should be irrelevant.