Payrolling benefits in kind – is this the future?

7th March 2022

HMRC’s most recent Employer Bulletins are indicating a clear shift towards the promotion of payrolling benefits, with the topic being mentioned in nearly every latest issue.


The payrolling of benefits in kind shifts the management of the process from annual to monthly reporting, allowing employees to pay tax in ‘real time’ during the tax year in which the benefits are received.


If payrolling benefits are to become mandatory in future years, what do you need to know?


  • The requirement to produce P11Ds for each employee after the end of the tax year is removed, with just a P11D(B) needing to be submitted to HMRC.
  • With the exception of interest free/cheap loans and living accommodation, all benefits can be payrolled through compliant software.
  • No surprising tax code changes are issued to employees in the following tax year.
  • Communication with your employees about the changes and the way this affects them is key.
  • A year long commitment is needed: employees can only be removed from payrolling if leaving your employment or if their pay falls to less than 50% of the value of the tax on the benefit (i.e. maternity leave).


Perhaps the most fundamental point to note is the necessity to register prior to the tax year that you wish to commence payrolling in.


To payroll benefits for the tax year 2022/23, registration is required before 5 April 2022.


Speak to your Whitings contact today or call the Ely office on 01353 662595.

Disclaimer - All information in this post was correct at time of writing.
Other Blogs
Jaimie King
19th April 2024 Audit exemption limits set to rise

What could the changes to Audit exemption limits mean for you?   The government has recently announced changes to company law that will see company size thresholds increased by 50%. This is hoped to reduce complexity and additional burden for companies. These changes are intended to be in place for year ends commencing on or…

Paul Jefferson
18th April 2024 Beware of VAT refund fraud

Beware of VAT refund fraud!   We have become aware of several recent cases where taxpayers’ bank account details have been amended on the HMRC portal, without their knowledge, so that VAT repayments have been fraudulently diverted to a third party.   It seems that HMRC have been acting on the basis of a fraudulent…

Andrew Band
17th April 2024 Whitings 2024 Annual Farming Seminar

Our Whitings 2024 Annual Farming Seminar is just around the corner.   Farming always has to cope with changing environment, weather, commodity prices, political changes, etc. This year these challenges feel heightened and this is why we are pleased to welcome back speakers from the Andersons Centre to inform us of these changes and what…

Amanda Newman
17th April 2024 Buy To Let through a Limited Company

There continues to be an ongoing debate when buying a residential property to let out about whether to buy this personally or set up a limited company to own it. Unlike our sole trader v limited company comparisons for a trading business there is not a clear division based on profits. There are a lot…

Nick Edgley
11th April 2024 Do you need to re-register for Child Benefits?

If you’ve heard about the changes post 5 April 2024 and are wondering whether you need to re-register for Child Benefits, this is the blog post for you.   If you have been affected by the increase in the High Income Child Benefit Charge cap to £60,000, then you may need to restart your Child…

Peter Brown
10th April 2024 Pension Contributions for directors

Are you thinking about planning ahead for retirement and want to find out more about Pension Contributions for directors?   When it comes to planning for your retirement, Company pension contributions can offer significant benefits in terms of reducing your company’s Corporation Tax bill. Here’s how you can use both personal and company contributions to…