P11Ds and dispensations

System
System Posts: 100,537 🤖 Admin 🤖
edited June 9 in General accounting discussion

I started acting for a client a few months back and am trying to do the P11Ds now (late, I know, but not entirely my fault)

It's a small Ltd company, employing 4 people (husband, wife, daughter + one other). The director claims his travel & subsistance costs through expenses claims and is very good at keeping them reasonable with receipts. He claims mileage at the approved rates, so I'm not worried about that side of it.
Last year the accountant only declared the BUPA cover on the P11Ds, so I assumed there was a dispensation in place for the other expenses, but I've not seen anything confirming this and when I tried ringing the revenue I got the usual helpful reply of 'there's no-one in who can answer that til next week'.
So now I'm frustrated - to add to the situation I've not been given March's expenses yet, so I couldn't calculate the total anyway.
Does anyone know whether dispensations can be backdated? If one's not in place could I apply now or have I left it too late?
Or what about estimates? Apparently even if a dispensation is in place I can still include the amounts on the P11Ds - do you think I could estimate march's figure on the basis that there's no tax/NI due anyway as it's all for business use?

Why do 10 minute jobs always end up taking so long?!

Comments

  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P11Ds and dispensations

    I know that you can apply for a dispensation after 5 April and if HMRC agree it before 6 July, it applies for the P11d's due for that tax year.

    Expenses were not worried about so much in the past but HMRC are clamping down on it now, so it could be last year they were just lazy, and blokey kept rubbish records, which doesn't help!

    I suggest you tell him that HMRC can fine up to £3,000 for an incorrect or incomplete return, and if he doesn't have a problem with that, you'll make something up for March! That way it's his problem, not yours.
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P11Ds and dispensations

    I had heard that regardless of dispensation, directors expenses need to be put on a P11d, has anyone else heard that?

    Annette
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P11Ds and dispensations

    Yes I too thought a P11d had to be filled in regardless of a dispensation for directors unless they are full time directors and earn less than £8500pa and have less than 5% control of the ordinary share capital.

    Someone please correct me if I'm wrong

    Michelle
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P11Ds and dispensations

    Depends what the dispensation says. You can get dispensations for staff only, or all staff incl directors. It is more difficult to get one for directors, you have to prove that someone else is approving the expense claims, and HMRC aren't big on allowing Mrs X to approve Mr X's expense claims!

    If there are several directors, all unrelated, and all expense claims have to be approved by someone other than the claimant, a dispensation can include directors.

  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P11Ds and dispensations

    Yes, the accountant I work for had that problem with her dispensation.
    The practice is set up as a Ltd company and she is the sole director, her niece is company secretary. When she put in her niece would be signing off the expenses the revenue would not allow the dispensation because they are related.
    According to IR she has to wait 18 months before she can apply for the dispensation again.
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P11Ds and dispensations

    Well it's not all doom & gloom! I've just spoken to an exceptionally helpful lady at HMRC and after I'd explained the situation she said that there's no need to declare the expenses on the P11Ds and that she'd send out a dispensation for me that covers 2005/06 :D

    It must be my lucky day!

Categories

Privacy Policy