Payrolling benefits compared to processing benefits using P11D software

Your options to process your employees' taxable benefits in Sage 50 Payroll or Sage 50 P11D.

If you provide taxable benefits or benefits in kind (BIKs) to your employees, submit a P11D(b) form to HMRC by 6 July each year. Common examples of these benefits are company cars or medical insurance. 

You can either include the cash equivalent value of the benefits in your payroll and deduct the tax, or complete form P11D for each employee:

Cash equivalent in payroll

You can use Sage 50 Payroll to payroll benefits except for accommodation, beneficial loans and credit tokens or vouchers.

Form P11D

Alternatively, Sage 50 P11D is a convenient way to calculate your employees’ taxable benefit values and calculate Class 1A National Insurance.

It’s easy to use and there’s no requirement for in-house experience.

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Using Sage 50 Payroll

• Register with HMRC at Gov.UK before 5 April 2026 for the tax year 2026/2027
• Once you begin, you have to payroll the benefits for the whole tax year, or until you stop providing them
• You work out the Class 1A NI contributions on benefits and manually complete form P11D(b)
• If you make a mistake, roll back or restore your data
• Calculate the P11D values or cash equivalent manually, then you enter them into Sage 50 Payroll

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Using Sage 50 P11D

• You can print P11D forms for your employees
• You can submit your P11D forms and P11D(b) to HMRC in just a few clicks
• It's easy to correct mistakes. Just delete the benefit and start again
• A leaver part-way through the tax year makes no difference. You don't have to employ them to receive the benefit
• When you set up your benefits, you can use the Sage 50 P11D software to calculate the figures

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Payrolling benefits

If you register for payrolling benefits, you need to provide a letter to your employees letting them know what it means for them.

Give your employees the following information before 1 June after the end of each tax year:

• Details of the benefits you have payrolled, for example, car fuel
• The cash equivalent of each benefit that you have payrolled
• The relevant amount you've payrolled for optional remuneration (OpRA)
• Details of benefits you haven't payrolled

You can give this information on your employees' payslips or in a separate note or statement. Make it clear to employees:

• What benefits have been subject to tax
• How much of the value of each benefit you've collected and reported tax on

If your employees fill in a Self Assessment tax return, they'll need this information so they can inform HMRC.

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Interested in Sage 50 P11D?

Sage 50 P11D makes it easy to calculate your taxable benefit amounts and class 1A National Insurance.

This helps to ensure you submit accurate information to HMRC.

If you're interested in purchasing Sage 50 P11D, leave your details and we'll be in touch.