Employers need to report all BiKs (including those under OpRAs, to HMRC on form P11D from 6 April 2018), unless they are registered to voluntarily payroll benefits.

OpRAs are where an employee gives up the right to an amount of earnings in return for a BiK and includes flexible benefit packages with a cash option, cash allowances and salary sacrifice.

The income tax and employer National Insurance contributions (NICs) advantages of BiKs - and employee NICs advantages where a charge exists - have mainly been withdrawn due to new rules that took effect in April 2017.

From the 2018/19 tax year, the rules will cover all OpRAs, apart from those for cars with emissions above 75g CO2/km, school fees and accommodation, which will be included from 6 April 2021.

If a BiK is provided under OpRA rules, the taxable value is now the higher of the cash foregone or the taxable value under the normal BiK rules. This applies to all BiKs, including those that were previously exempt, such as workplace parking.

However, pensions, pension advice, childcare, cycle-to-work schemes and cars with emissions of 75g CO2/km or less are not affected by the rules.

HMRC is advising employers of the need to ensure that they complete their P11D accurately, including all the details of cars and loans provided.

Common errors include inaccurate recording of car emissions, time apportionment and free use of fuel, and the incorrect classification of ‘making good’.

The closing date for employers to send P11Ds to HMRC is 6 July 2018.

Guidance Salary sacrifice for employers is here.

Technical advice is here.

Report by Pat Sweet