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Notional / Benefits In Kind Payment Setup

Use

Notional / Benefits in kind are benefits which employees or directors receive from their employment but which are not included in their salary cheque or wages. They are sometimes called ‘perks’ or ‘fringe benefits’. They include things like company cars, private medical insurance paid for by the employer and cheap or free loans. Some benefits in kind will not be taxed. Some benefits in kind will be taxed only for people who are not in lower paid employment. Some benefits in kind will be taxed for everyone, whatever their income.

You may have additional reporting requirements to fulfil, as well as Class 1A National Insurance contributions (NICs) to pay. You can enter the details of benefits in kind in this screen. From 6 April 2016 onwards , both existing and latest payrolled benefits and expenses must be registered with HMRC using the online Payrolling Benefits in Kind (PBIK) service. If you are making use of this service then there is no need to report them on P11D return. If not, then it's necessary to e-file P11D return end of the year. But either way its mandatory to submit a P11D (b) form end of the year including the total benefits and expenses provided.

Path

Employer / Setup > Chart of Setup > Notional / Benefits In Kind Payment Setup

OR

Bureau Main Page > Admin Payrun > Enter > Employer / Setup > Chart of Setup > Notional / Benefits In Kind Payment Setup

OR

Multi-Sites Payroll Starter > Head Office Details > Employer / Contractor Setup > Chart of Setup > Notional / Benefits In Kind Payment Setup

Fields Available

Fields marked with an asterisk (*) are mandatory.

• Benefit Item code: Enter here the benefit item code. Please note this code is useful when you import the employee time sheet.
• Benefit Payment Name: You can enter the benefit payment name here.
• Benefit Type: Enter the description of the benefit item here.
• PAYE Tax: State whether you would like to include benefit item in Gross Pay before the PAYE tax is calculated or after the PAYE tax is calculated. If you select Yes the benefit item will be included in the employee's pay before the tax is calculated and hence it is taxable. If you select No, the benefit item will be included after the tax is calculated and hence it is non taxable.
• Employee Nic: State whether you would like to include benefit item in Gross Pay before the NIC is calculated or after the NIC is calculated. If you select Class1 the benefit item will be included in the employee's pay before the NIC is calculated. If you select Nil, the benefit item will be included after NIC is calculated.
• Employer Nic: State whether you would like to include benefit item in Gross Pay before the NIC is calculated or after the NIC is calculated. If you select Class1 the benefit item will be included in the employee's pay before the NIC is calculated. If you select Nil, the benefit item will be included after NIC is calculated.
• Add to Pension Calculation: State whether you would like to include benefit item in Gross Pay before the pension contribution is made or after the pension contribution is made. If you select Yes the benefit item will be included in the employee's pay before the pension contribution is made. If you select No, the benefit item will be included after pension contribution is made.
• For AE Assessment: Qualify Earning for Auto Enrollment (AE) means to decide if the earning item is to be included in AE assessment.
• Holiday Purposes: Holiday Payment item will be added if you select YES if NO is selected the payment item won't be added in the gross pay.
• Occurrence: Occurrence refers to the frequency setting for the item i.e. how often the benefit item will be applied to the employee's wages. If the occurrence is set as Recurring, the benefit item will automatically be included in the employee's wages each and every time the employee's pay is calculated. If the occurrence is set as 'Non-Recurring', the benefit item will not apply regularly to the employee's wages. The item will only apply on a one off basis in the next pay calculation you run for the employee and after that it will not automatically reappear.
• Remark: The remarks for the benefit type will be displayed here.  
• Action: The various tasks associated with the data in each row will be displayed here. For example Save, Edit, Delete, etc.

Associated Tasks

• Save: Click on this button to save the benefit item you have created.
• Back: Click on this button, If you have finished viewing or modifying the details and wish to leave this screen.

Related Topics

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