Employers have until 6 July to meet a number of important reporting obligations for taxable benefits and employment related securities for the 2025/26 tax year.
While the date appears in the calendar every year, it is one that can still catch businesses out, particularly where information sits across payroll, finance and HR or where there is uncertainty over whether items should be reported on forms P11D, included in a PAYE Settlement Agreement (PSA) or dealt with in another way.
For many employers, this will mean preparing P11D forms for employees and directors who received reportable benefits in kind, submitting a P11D(b) to declare the Class 1A National Insurance due, and giving employees copies of the relevant information by the same deadline. HMRC’s published deadlines also confirm that Class 1A National Insurance on work benefits is then due by 22 July if paid electronically, or 19 July if paid by post.
At the same time, employers should not overlook any annual returns required for employment related securities. Where a business has operated a share scheme, granted options or made even a one-off award of shares to an employee or director, an annual return may be required by 6 July as well, including in some cases a nil return where a scheme remains registered.
What needs to be reported by 6 July?
The 6 July deadline is a key point in the employment tax calendar because several obligations can fall together. Employers who have provided taxable benefits or reimbursed expenses that have not been payrolled will generally need to report those items to HMRC by that date and provide employees with the relevant details as well. Alongside this, form P11D(b) must be submitted to declare the total Class 1A National Insurance liability, including for benefits that have been payrolled during the year. HMRC states that the late filing penalty for a P11D(b) is £100 per 50 employees for each month or part month it is outstanding, so missing the deadline can quickly become expensive.
This is also a good time to sense-check whether all benefits have been identified correctly. Common reportable items may include company cars and fuel, private medical insurance, beneficial loans, accommodation and certain reimbursed personal expenses. In practice, the challenge is often not understanding that these items are taxable but making sure that nothing has been missed across different internal systems and that each item has been allocated to the correct reporting route.
Employers that have registered share plans or other employment related securities arrangements should also review whether an annual return is due. HMRC’s guidance makes clear that returns are required each year for registered schemes, even where there have been no reportable transactions and a nil return is needed instead. It can easily be missed when a scheme was registered some time ago and is no longer front of mind.
Why PAYE Settlement Agreements need attention now
The PSA point is often the one that causes the most confusion. A PSA allows an employer to settle the income tax and Class 1B National Insurance on certain minor, irregular or impracticable benefits on behalf of employees, so that those items do not have to be processed through payroll or reported on individual P11Ds. This can be useful for items such as certain staff entertaining, small gifts or one-off benefits that would otherwise create an unwelcome tax charge for employees. PSAs are intended for specific categories of benefits and are not a catch-all solution for everything an employer may provide.
The timing is critical. If an employer wants a PSA to apply for the 2025/26 tax year, the agreement needs to be in place by 5 July following the end of that year. In practical terms, that means the employer needs HMRC agreement before the 6 July reporting deadline arrives. Although the PSA calculations and payment are dealt with later, the arrangement itself cannot simply be left until after the summer filing deadline has passed. HMRC’s own guidance confirms that employers then pay the tax and Class 1B National Insurance under the PSA by 22 October if paying electronically, or 19 October if paying by post.
If a PSA is not in place in time, the employer may need to fall back on the normal P11D process for any items that cannot otherwise be covered. That can create an unexpected administrative burden at exactly the point when reporting deadlines are already close. It may also mean revisiting assumptions made earlier in the year about how benefits would be taxed and reported, increasing the risk of omissions, late filings and avoidable penalties.
It is also worth reviewing whether an existing PSA still reflects the benefits actually being provided. Although a PSA can continue from year to year, changes in practice, new staff initiatives or one-off events may mean the scope needs to be updated. A quick review now can help confirm whether the right items are covered, whether any exempt benefits have been treated correctly and whether additional approval from HMRC is needed before the deadline.
Practical steps for employers before the deadline
For employers, the key message is that 6 July is the point by which businesses should have identified all reportable benefits and expenses for the year ended 5 April 2026, confirmed whether P11Ds are required, submitted the P11D(b), given employees the relevant information and checked whether any employment related securities returns are also due. For businesses using or considering a PSA, it is also the cut-off point for getting the agreement in place for the year.
A sensible approach is to start with a structured review of all benefits, expenses and share-related events from the tax year, then map each item to the correct treatment. That includes checking whether any benefits were payrolled, whether any items may be covered by exemption, whether a PSA is appropriate and whether the information held by payroll, finance and HR is consistent. Businesses should also confirm who is responsible for making each submission and approving any payments, particularly where external advisers, payroll bureaux or multiple internal teams are involved.
There is also a wider reason to use this year’s deadline as a prompt to review processes. HMRC has confirmed that the reporting of most benefits will move to mandatory payrolling from April 2027, bringing an end to most traditional P11D reporting. While that change is still ahead, employers may benefit from using the current reporting cycle to identify data gaps, clarify responsibilities and decide whether current systems are ready for a more real-time approach.
Taking stock now can help reduce the risk of last-minute surprises, unnecessary penalties and incorrect reporting. For employers with more complex benefit arrangements, internationally mobile employees or share-related activity, early advice can be particularly valuable in making sure the right treatment is applied before the deadline passes.
