The Budget contained a measure to amend primary legislation to allow HMRC to make changes to the PAYE regulations to enable the voluntary payrolling of non-cash vouchers and credit tokens, in order to reduce employers’ reporting obligations and reduce errors
Legislation will be introduced in Finance Bill 2016 to amend section 684 of ITEPA to allow HMRC to amend the PAYE regulations to include non-cash vouchers and credit tokens in the framework for voluntary payrolling.
The move brings these items in line with other benefits in kind, such as fuel allowances and medical insurance, which can be included in voluntary payrolling from 6 April 2016, following legislation included in the Finance Bill 2015. This focused on the options most commonly provided by employers and which are therefore the largest by volume and value.
HMRC will amend the PAYE Regulations in the summer of 2016 to enable employers to voluntarily payroll non-cash vouchers and credit tokens from 6 April 2017.
The measure is expected to reduce the administrative burden on employers who choose to voluntarily payroll non-cash vouchers and credit tokens. The reporting burden on employers will be eased as the obligation to submit P11Ds will be reduced or removed.
Employers currently payrolling on an informal basis will benefit, as there will be no obligation to return a P11D for non-cash vouchers and credit tokens.
