guide to private medical insurance and p11d
The following information provides general guidance on how to handle private health insurance details when completing a P11D benefit and expense form. for advice on specific cases you should always speak to hm revenue & customs (hmrc), your accountant or tax advisor.
what is a p11d?
a p11d is a form issued by hmrc. its full title is benefit and expense form p11d. At the end of each fiscal year, employers must complete a P11D for each employee or director who:
- have received expenses or benefits in addition to your salary.
- This does not include routine business expenses and benefits such as travel and fuel for company cars.
- a p11d are year-end expenses and benefits that an employer must report for employees.
- a p11d(b) is used to report the amount of class 1a national insurance contributions due on expenses and benefits you have provided to employees.
- copies of your annual plan summary.
- formula used to calculate costs for members and family members.
Alternatively, you can register with hmrc for this benefit in kind on the voluntary payroll.
what is the difference between a p11d and a p11d(b)?
is it necessary to include private health insurance in a p11d?
yes. When it pays for an employee’s or director’s private health insurance as part of their benefits package, HMRC considers it an “in-kind benefit.”
each year, p11d collects details of the cost of these in-kind benefits. so you must include private health insurance details in p11d.
If the employee or director pays for his/her own private medical insurance with his/her salary, it is not necessary to include it in p11d.
how do you know the cost you pay for each employee?
Your annual plan summary details the cost of private health insurance for each employee on your plan.
If, for example, the cost of individual coverage is £600, the member’s coverage is double the amount of individual coverage. family coverage is calculated as 2.5 times individual coverage and single-parent family coverage is calculated as 1.6 times individual coverage. For those who make contributions for family members, the amount contributed each year is deducted from the p11d value.
Multipliers shown are approximate. You should always check the breakdown of single/couple/family and single parent with your provider.
How do I calculate the value of the benefit in kind for private health insurance (pmi)?
The value of the benefit in kind is the private medical insurance premium of the employee or manager.
You must declare the full amount of the in-kind benefit on your p11d shipment, ie £600.
what if your employees contribute to the cost of your private health insurance plan?
If the employee contributes to the cost of your private health insurance, deduct the amount of your contribution from the total premium. and then calculate the in-kind benefit in the same way.
How is the value of the in-kind benefit calculated if an employee joins or leaves in the middle of the plan year?
You need to calculate the prorated value of the in-kind benefit: the cost for the time they were employed. provide this amount in p11d.
what can axa health provide to help you with your p11d calculations?
we can provide:
How will the values informed in the p11d affect my employees?
the p11d in-kind benefit may result in your employees receiving a revised tax code to reflect any overpayments or underpayments of taxes.