Now that the 2025/26 tax year has closed, it is time for companies with directors and employees to turn their attention to Benefit in Kind (BIK) reporting. If your business has provided benefits or paid expenses on behalf of directors or employees during the year, these will almost certainly need to be reported to HMRC — and the deadlines are closer than you might think.

What Counts as a Benefit in Kind?

The range of reportable benefits is broader than many people assume. The most commonly overlooked include:

• Private medical insurance
• Company cars and associated fuel
• Beneficial or interest-free loans through directors’ loan accounts
• Use of company assets such as property, vehicles or equipment
• Personal expenses paid or reimbursed by the business

This is not an exhaustive list — many routine transactions can give rise to a reportable benefit, so it is worth reviewing the year’s transactions carefully.

Key Deadlines for 2025/26

There are three dates to keep firmly in mind:

6 July 2026 — submit P11D forms to HMRC and provide copies to the relevant employees and directors.

22 July 2026 — pay Class 1A National Insurance contributions electronically to HMRC.

Missing these deadlines can result in penalties and interest charges, so prompt action is important.

What to Do Now

We recommend taking the following steps as soon as possible. Start by reviewing all benefits and expenses provided to directors and employees throughout the year, including any personal expenses paid or reimbursed by the company. Check for loan arrangements or non-cash benefits, ensure all benefits are correctly calculated, and make provision for the Class 1A NIC liability that will fall due in July.

Our Tax Team can assist with identifying Benefits in Kind within your business, preparing and submitting P11D and P11D(b) forms, calculating Class 1A NIC liabilities, and advising on director-specific compliance considerations.

Looking Ahead: Mandatory Payrolling of Benefits from April 2027

Whilst you are focused on the 2025/26 submissions, it is worth being aware of a significant change on the horizon. From April 2027 (the 2027/28 tax year), HMRC intends to make the payrolling of most taxable Benefits in Kind mandatory, with employer‑provided accommodation and loans initially excluded from the mandatory regime. This will mean that benefits provided to directors and employees are taxed in real time through the payroll, significantly reducing the need to file P11Ds for most payrolled benefits.

We will provide more detailed guidance as the implementation date approaches, but early consideration of your current processes is worthwhile to ensure the transition is as straightforward as possible.

Get in Touch

If your business provides benefits to directors or employees and you have not yet been in contact with our team, please reach out as soon as possible. The July deadlines leave little room for delay.

These articles are for guidance only and professional advice should be obtained before acting on any information contained in them. No responsibility can be accepted for loss occasioned howsoever to any person as a result of action taken or refrained from as a result of reading.