HM Revenue and Customs require all employers to issue a form ‘P11D – Expenses and Benefits’ to all employees where they are in receipt of allowances/ expenses that require taxation.

The council pays the following allowance/ expenses that require reporting on a P11D

  • Essential Car Users Allowance
  • Relocation expenses in excess of £8,000 (this is eligible new employees who have to relocate to the Aberdeen area to take up their appointment).
  • Salary Sacrifice scheme Home Technology
  • Salary Sacrifice scheme Car Lease

All employees who receive one or more of these allowances/expenses will receive a P11D return before 6th July, each year.

This return shows any taxable allowances/benefits you have received during the tax year. These amounts should be included if you complete your annual tax return.

If you do not complete a tax return values will be uploaded to the HMRC who will make any necessary adjustments to your tax code and recover the liability through the payroll system, you will receive a letter from the HMRC informing you of the change and new code.


Essential and Casual Users

With effect from 1st April 2012, the Inland Revenue use the following table to calculate the profit element:

C.C. BANDS 0 – 10,000 10,000 – 99,999
0 – 9999 45.00p 25.00p

Example 1
Essential User – 1600 c.c. 3000 miles p.a.

Lump Sum paid by Council = £120.00
Mileage paid by Council = £1350.00

Amount allowed by the Inland Revenue 3000 X 45p £1,350.00
Taxable Benefit for the Year £120.00

As we currently pay the Inland Revenue rate (see above) for mileage, there will be no liability for any mileage paid by the council. The only figure reportable to the Inland Revenue will be the Essential Car Users allowance.

Example 2
Casual User – 1600 c.c. 3000 miles p.a.
Mileage paid by Council= £1,350.00
Allowed by I.R.= £1,350.00
Taxable Benefit for the Year = £0.00

As we currently pay the Inland Revenue rate (see above) for mileage a casual user has no tax liability. A P11D will not be produced nor any figures reported to the Inland Revenue


Salary Sacrifice Home Technology Scheme 

All Officers currently enrolled in the Home Technology Scheme will receive a P11D based on the market value of the asset

Example: Asset value of £600 provided over a three year period,

Value reportable to the HMRC and shown on your P11D will be £120

(20% of £600 assets market value)

The annual tax charge will be £24 for a basic rate taxpayer (taxed at 20%)


Salary Sacrifice Car Lease Scheme 

Each Officer in the Car Lease scheme will receive a P11D, this P11D will detail the Leased Car, the Co2 Emissions figure (in grams per kilometre), Type of fuel, Days available, Value of the car.

Each of these items determine the tax liability.

Example Calculation:

Leased Car: Ford Fiesta

Fuel Type: Petrol

Co2 Emissions 99 at this level HMRC Tax and Benefits Calculation Charge is 16%

Assets Value £14,735

Available 100 days of the year

Asset Value £14,735 x Calculation Charge 16% = £2,357.60

Availability (divide by 365 days, multiplied by 100 available days) = £645.91

When rounded will be reported as £645

You might also be interested in viewing the ‘Taxable Benefits in Kind and Expenses Payments’ table, available here


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