From 6 April 2016, a new statutory framework will allow you to deduct the tax due on benefits in kind through your payroll processes rather than through an employee’s tax code.

To start with you will be allowed to payroll four benefits in kind.

These are:
• cars
• car fuel
• private medical insurance and
• subscriptions – such as gym membership.

If you would like to payroll any of these benefits in kind, you will need to register your intention with HMRC. A new online registration service to allow you to do thiswill be available from July 2015. Once you have registered your intention you will not
need to complete a P11D for those benefits in kind which you will have registered to‘payroll’ once it is introduced from April 2016.

Payrolling benefits in kind should result in fewer tax coding notices being issued,as well as fewer under and overpayments of tax.

The draft regulations setting out the framework for voluntary payrolling will be published in the summer for consultation.