How Do I Reinstate Excluded Employees Back to Vehicle and Mileage Benefits?

How Do I Reinstate Excluded Employees Back to Vehicle and Mileage Benefits?

You, as the employer, must not deduct more than 50% in tax from an employee’s pay. This is called the Overriding Limit and ensures that employees aren’t left with too little pay to cover their living costs. This limit is automatically imposed where tax is calculated.

In some circumstances a high value benefit or expense, combined with low pay, could mean that the employee takes home little or nothing. This might be where an employee is being paid Statutory Sick Pay. You can keep the employee in payrolling and carry forward the taxable amount of the benefit into future pay periods in that tax year.

However, it is possible to stop payrolling benefits for this employee by excluding the employee from payrolling using the HMRC online service. In this case, it is necessary to submit a manual P11D for the employee detailing any untaxed benefits received by the employee during the year.

You must inform HMRC which employees are to be excluded before you exclude them within Cintra iQ. For more information, visit https://www.gov.uk./
You can only reinstate an excluded employee in the year following the submission of the P11D for the tax year the exclusion was made. This is done via the Payroll Benefits section of the HMRC website.

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