Add Benefits in Kind

If you want to payroll benefits and expenses (aka add Benefits in Kind), you must register them with HMRC through the payrolling benefits and expenses online service before the start of the tax year.

For more information, see HMRC's Guidance on Payrolling.

Note: We can’t advise on which categories benefits should fall into or provide guidance on the provision of benefits or their cash equivalent values. If you have questions about how a benefit should be determined or calculated, please consult a qualified tax advisor. They can advise you based on your specific circumstances and current HMRC guidance.

UK Payroll supports Cars (P11D Section F), Private Health (P11D Section I), Membership (P11D Section N), and Expenses (P11D Section M) benefits only.

How to add Benefits in Kind to payroll

To see how to payroll company cars, see the next section.

1. From the left side bar, select Employees.
2. Select the relevant employee.
3. Navigate to the Pay items tab.
4. Click Add pay item.
5. Select the Benefit type (Private health, Club membership, Expenses payments, Other items) you want to add.
6. Enter the Description, Starting from date, Per payroll value (monthly cost of the benefit), and Making good (the monthly amount an employee contributes, if any, to the benefit).
7. To add the benefit to payroll, mark the PAYE option under Tax Method.
8. If the employee has already paid any amount towards the benefit in this tax year, select Yes under Starting Points and enter the Benefit cost starting point (how much the benefit has cost up until now) and the Making good starting point (the amount of year-to-date contributions from the employee). If the employee hasn't paid anything towards the benefit in this tax year, select No.
9. Click Next.
10. Review the benefit details in the Summary, then click Save & close.

You'll see the Benefit in Kind value on your employee's draft payslip.

How to add cars to payroll

1. From the left side bar, select Employees.
2. Select the relevant employee.
3. Navigate to the Pay items tab.
4. Click Add pay item.
5. Select Company car.

6. Enter the Available from date (the date the car was first made available to the employee). 

   Note: If the car was available to the employee in a previous pay period, but the benefit wasn't added into UK Payroll, contact Support to resolve the missing payment.

7. Enter the Effective date (the date from which UK Payroll should start calculating the benefit). 

8. If the employee has paid towards the car benefit in the current tax year, mark the button next to Yes under Starting points. This ensures the year-to-date value of the car benefit is correct.

   Note: This is only necessary if you are setting up a benefit part-way through a tax year. Starting points can also apply to fuel.

9. If you know when the car will be returned, mark Yes and enter the Return date. If not, mark No.

   Tip: You must add a return date to the company cars that are payrolled when employees are terminated. This will pro-rate the value in the final period if needed and avoid it appearing in future year P11D(b), where they should not be processed.

10. If the car has been unavailable for more than 30 consecutive days, mark Yes and enter the Total days the car was unavailable. If this isn't the case, mark No.
11. Click Continue.
12. Enter the car's Registration number and click Continue.
13. Enter the car's details, including the Date of first registration, Car make, Car model, Fuel type, Engine size, and CO2 emissions. Click Continue.
14. Enter the cost details, including the List price of the car, Total cost of accessories, Capital contributions (any amount contributed by the employee towards the cost of the car), Private use deductions (total amount of any payments made by an employee for the private use of the car in the current tax year).

15. If the car is provided via salary sacrifice, mark Yes under Is the car provided via an Operational Renumeration Arrangement? and enter the Amount foregone. If not, mark No.

    Note: Any salary sacrifice deduction should be applied as a separate recurring pay item. If the amount foregone is greater than the calculated yearly cash equivalent, the cash equivalent will be used as the benefit value, unless the CO2 emissions are less than 75g/km.

16. Click Continue.

17. If the business pays for private fuel, mark Yes under Does the business pay for private fuel?. Then, mark whether the fuel was withdrawn during the period of car availability. If it was, enter the date in When was private fuel withdrawn? Then, mark Yes If the fuel was provided via an Operational Renumeration Arrangement and enter the Amount foregone, or mark No if not.

    Note: If the business doesn't pay for private fuel, mark No. To learn more, see HMRC's Guidance on Advisory fuel rates.

18. Click Continue.
19. Review the details in the Summary, then click Save and close.

You'll see the Benefit in Kind value on your employee's draft payslip.

How to bulk add company car and fuel pay items

If you need to process multiple company cars and fuel benefits for multiple employees, you can import them as a XLSX, XLS, or CSV file.

1. From the left side bar, navigate to Employees.
2. Click Import/Export > Import company car and fuel pay items.
3. Click Select file to use the file navigator, or drag and drop your file into the screen.
4. Select the correct header row.
5. Once headers are confirmed, the column headings will begin matching automatically, which you can confirm by clicking Confirm mapping. If you have any columns that are unable to be matched, select the correct option from the dropdown menu.
6. To quickly validate the data, toggle on Show only rows with errors. You can then validate the data at the row or cell level.
7. If you are ready to submit, click Yes.

How to bulk update Benefits in Kind

If you need to update the cash value of existing payrolled Benefits in Kind (BiKs) for multiple employees (for example, annual benefit value changes), you can do this with an import.

Note: The Starting from date is used to calculate the annual cash value shown on the employee’s Benefits in Kind pay item (based on the number of pay periods remaining in the current tax year). It doesn’t control when the updated value appears in payroll. Additionally, the value only impacts the current draft payroll.

1. From the left side bar, navigate to Employees.
2. Click Import/Export > Bulk update benefits in kind.

3. Click Select file to use the file navigator, or drag and drop your file into the screen. Or, to input your data manually, click I want to input data manually. 

   Tip: Download a template file by clicking Download template file to ensure all required data is uploaded.

4. Select the correct header row.
5. Once headers are confirmed, the column headings will begin matching automatically, which you can confirm by clicking Confirm mapping. If you have any columns that are unable to be matched, select the correct option from the dropdown menu.

6. To quickly validate the data, toggle on Show only rows with errors. You can then validate the data at the row or cell level.

   Note: Rows with errors will be ignored. 

7. If you are ready to submit, click Yes.

FAQs

What if I forgot to take a benefit out of an employee's record that is reported on a P11D?
Contact the support team to ask them to remove the benefit from the employee's record.