In January 2024, HMRC announced plans to change how you process and submit employee benefits. This includes making payrolling benefits in kind mandatory instead of using P11Ds.

To read this announcement, go to gov.uk.

HMRC originally planned for this change to take effect from 6 April 2026. However, on 28 April 2025 HMRC announced a change of date to 6 April 2027.

Confirmation of this is available at gov.uk.

June 2026 announcement

On 15 June 2026, HMRC announced further changes to the planned rollout of the mandatory payrolling of benefits. The rollout will now be in phases.

To read HMRC's statement on this, go to the latest gov.uk announcement.

Phased rollout

Find out more about the phased rollout below.

Phase one - from April 2027

Payrolling employee benefits becomes mandatory from this date for the following benefits only:

• Company cars and fuel
• Vans and van fuel
• Private medical benefits

HMRC has prioritised these benefits as they're the benefits that employers provide most commonly. 

Phase two - from April 2028

Most remaining benefits become mandatory, with loans and accommodation benefits planned to become mandatory at a later stage.

Class 1A NI

We're awaiting details from HMRC on the calculation and mandating of Class 1A NI contributions.

We'll provide more information on this, including how to submit your benefits to HMRC from your software, when this information is available. 

Next steps

We're working closely with HMRC on these changes, and we'll update this article with further information as it becomes available.