It has been reported that employers and agents who have submitted forms P11D and P11D(b) on time are receiving penalty warning letters from HMRC.

The Institute of Chartered Accountants in England and Wales's (ICAEW’s) Tax Faculty has been alerted to the issue and has received explanations from HMRC:

  • There is a six to eight-week backlog of paper Forms P11D and P11D(b) due to front-line staff being reallocated to COVID-19 work. This has led to delays in logging receipt of forms.
  • For online filings, there are a number of reasons for processing delays, including discrepancies between the information reported on the forms P11D and P11D(b) and HMRC’s existing records (e.g. PAYE references). Such cases are placed on a separate list for manual review to clarify the discrepancies. While penalties should not be issued until discrepancies have been resolved, it is possible that a penalty warning letter may have already been sent.

HMRC has reassured the Tax Faculty that employers should ignore a penalty warning letter if they filed forms P11D and P11D(b) online or in paper form on time. Should a Late filing penalty be issued in respect of forms P11D and P11D(b) that were submitted on time, employers should appeal against this immediately.

Links

P11D: Reporting benefits and expenses
Employers have an annual obligation to complete forms P11D in respect of each employee in receipt of taxable employment benefits or expenses.

P11Ds: top tips tool kit
Top Tips for employers on preparing form P11D together with a checklist.

Penalties: P11Ds

How to appeal a tax penalty (subscriber version)
What are the steps in making an appeal? What should your appeal cover? What does recent case law say on this topic?

 

 

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