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I'm trying to complete my Self Assessment and it's fairly straightforward - I don't have any complicated tax affairs or multiple incomes. What's confusing me is the benefits section. I have private medical and dental insurance through my company. On my P11D it lists the cash equivalent value which is fine. On the P60 I see my taxable income. This all makes sense except that I believe my taxable income already has the insurance value added in as a BIK through payroll. Looking at my payslips I see a line entry for each benefit as a BIK. I can recalculate the taxable income only if I add on the BIK total. That's the value that ends up on the P60.

My concern is that my tax calculation is based on that P60 income value + the benefit from P11D - the tax free allowance. Now if the P60 value already includes the value from the P11D doesn't that mean I'm declaring the same benefit twice? If that was the case wouldn't the P11D reflect that value and list a cash equivalent value of 0?

As an additional question the total of the BIK on the payroll through the year is not exactly the same as the value on the P11D. Maybe I should declare the difference?

  • I get my benefits put through payslips, and I don't get a P11D at all. They show up as a "plus" on my before tax income and then a deduction from my after tax income. Can you check with your payroll department to see if they made a mistake? – Ganesh Sittampalam Jun 15 '17 at 21:55
  • They show as a plus on my before tax income but no subsequent deduction. They are included in the cumulative taxable income on the p60 though. I've been discussing with payroll but it's taken me 3 days of emailing with them to get an answer on whether bik are included in the taxable income. I got further by calculating it myself. I might have to call hmrc to discuss. – Jon Jun 16 '17 at 8:33
  • If they don't deduct it from the after-tax income, does the payslip even add up? Most payslips I've seen start with a gross salary, handle various additions and deductions, and end up with a net payment to your bank account. If they are adding it to your before tax income and not taking it off again anywhere else something won't actually match. – Ganesh Sittampalam Jun 16 '17 at 8:57
  • What appears to happen is that the income on which tax and ni are calculated ignore the bik. They're just salary - educations (pension etc). So that works out. However in the accumulations section showing ytd the taxable income adds in the bik. That taxable income is what ends up on the p60. So I think I haven't paid tax on the bik which is fine it gets picked up in the self assessment but I think the p11d shouldn't include the value since its already in the taxable income and it's lead me to add it in twice. – Jon Jun 16 '17 at 10:26
  • Did you get any more information from your payroll or hmrc? – Ganesh Sittampalam Jun 25 '17 at 18:02
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Benefits should be either put through your payslip and taxed there, or reported on your P11D. If you do see the same benefit both on your payslips (and hence included in the P60 totals) and in a P11D for the same tax year, that would be a mistake.

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