HMRC have proposed improvements to two tax reporting systems which should simplify and modernise the tax system.  These are

  • The reporting and payment of Income Tax and Class 1A National Insurance contributions on benefits-in-kind via payroll software will become mandatory from April 2026.  By digitising this process, it will remove the need for four million end of tax year P11D and P11D(b) forms.  
  • There are also plans to simplify the process for employees who claim tax relief on their eligible business expenses.   Currently, claims are made via online apps, digitally or sometimes still on paper forms – all of which can be quite onerous.   It is proposed that a new online service will be introduced to enable employees to claim tax relief on all of their eligible business expenses in one place, which should speed up the process.

HMRC will be engaging with stakeholders to discuss their proposals.  Draft  legislation is expected towards the end of 2024, we’ll keep you up-to-date as more details are published by HMRC.