WFM UK: Payrolling Benefits in Kind to Become Mandatory

Overview

On 16th January 2024, as part of the Government's Simplification Update, it was stated that the Payrolling of Benefits in Kind is to become mandatory on benefits provided from 6th April 2026. Income Tax and Class 1A National Insurance Contributions on Benefits in Kind will be required to be calculated and paid via Payroll and reported via Real Time Information.

Currently, employer-provided living accommodation and interest-free & low-interest (beneficial) loans cannot be payrolled, so unless this changes, the use of electronic P11D submissions will still be required for those benefits. For all other benefits, P11Ds will not need to be provided to employees but a statement of benefits that have been payrolled will be required each tax year. The electronic submission of a P11D(b) will still be required by the 6th of July each year when payrolling Benefits in Kind.

Further details on payrolling Benefits in Kind can be found here.

Fourth's Response

April 2026 is not a finalised date but we hope to gain confirmation later this year, possibly in the Spring Budget.

Fourth is aware of payrolling Benefits in Kind and we have already planned to start work on a solution throughout 2024 and 2025 in anticipation. We will continue these efforts to ensure we remain compliant with the requirements and legislation.

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