News
Benefits in Kind (BiK): Mandatory Adoption from April 2027
19 Feb 2026
HMRC has published draft guidance on a significant change to the way Benefits in Kind will be reported. From April 2027, employers will be required to report Benefits in Kind in real-time through payroll software, rather than via the annual P11D process.
What This Means
Currently, Benefits in Kind (such as company cars, private medical insurance, and other taxable benefits) are reported annually on forms P11D. From April 2027, this will change to mandatory real-time reporting through your payroll system.
This is a mandatory change – all employers providing taxable benefits will need to comply with the new reporting requirements.
Current Status
The guidance is currently in draft form, and HMRC is still developing the technical requirements. We are monitoring these developments closely and will provide further updates as details become clearer.
We are not recommending that clients take any early action at this stage. The legislation and technical specifications are still being finalised by HMRC.
For Our Payroll Clients
If we currently manage your payroll and you provide Benefits in Kind to your employees, we’ll be working through this with you as the guidance develops.
Why We’re Telling You Now
While implementation is just over a year away, we wanted to ensure you’re aware of this upcoming change. As details become clearer and closer to the implementation date, we will provide further guidance and support to help you comply with the new requirements.
Further Information
HMRC’s draft guidance can be found at:
https://www.gov.uk/guidance/draft-guidance-and-legislation-to-aid-preparation-for-reporting-benefits-in-kind-in-real-time
We will continue to monitor developments and keep you informed of any significant updates.
