Employer Bulletin: June 2025

HMRC have published their Employer Bulletin for June 2025. We have summarised the key content for you, which links to our detailed guidance on the topics covered.

employer bulletin

P11Ds and P11D(b) for the 2024-25 tax year

Deadlines

  • Submit P11Ds and P11D(b) for the 2024-25 tax year by 6 July 2025.
  • Late submissions and failure to submit may result in a Penalty. 
  • Payment of Class 1A National Insurance (NI) must reach HMRC by 22 July 2025 (19 July 2025 if not paying electronically).

Filing requirements

  • You need to file a P11D(b) if:
    • You provided taxable benefits or non-exempt expenses.
    • You payrolled benefits. 
  • You need to submit a P11D for each employee receiving benefits or non-exempt expenses, unless you registered for Payroll benefits before 6 April 2024.
  • If you have not already registered to payroll your company benefits, you may wish to do so now, ahead of the 2026-27 tax year. 
  • HMRC no longer accept informal payrolling of benefits.

How to file

  • Use either:
  • You must submit all your P11Ds and the P11D(b) together in one online submission.

Helpful tips when completing P11D and P11D(b)

  • Use the exact registered business name, without abbreviations or punctuation. 
  • Amendments must be made using HMRC's online amendment form.
  • Only send one P11D(b) per PAYE scheme, showing the total amount due.
  • Use accurate start and end dates for Company cars:
    • Do not put '6 April 2024' as the start date or '5 April 2025' as the end date, unless they genuinely are the dates your employee received or returned a company car.
    • Include CO2 emissions for electric cars.
    • Include zero-emission mileage for hybrids (1-50g/km CO2).

No benefits to report?

Director and employee beneficial loans

  • Loans made available to directors and employees of more than £10,000 each will create a chargeable benefit when an employment-related, taxable, cheap loan has been taken. 
  • Loans should be reported on forms P11D and P11D(b) by 6 July each financial year. 
  • There are some exceptions to the chargeable benefit.

See Loans: Employment-related (beneficial loans)

Paying Class 1A National Insurance contributions

  • Electronic payments for Class 1A National Insurance Contributions (NICs) declared on your P11D(b) return for the 2024-25 tax year must clear HMRC's account by 22 July 2025. 
  • You must include your payment reference number when making a payment to HMRC.
  • Your payment reference number is your 13-character Accounts Office reference followed by 2513.

See P11D: Reporting benefits and expenses

Mandatory payrolling of benefits

The mandatory payrolling of benefits is delayed to April 2027, giving employers, payroll providers and agents more time to prepare.

Voluntary payrolling

  • It may be worth registering to voluntarily payroll Benefits In Kind from April 2026.
    • This will help you to familiarise yourself with the process in readiness for mandatory payrolling.
    • Opportunity to test and adapt your payroll processes and systems.
  • Must register for voluntary payrolling by April 2026 to payroll benefits for the 2026-27 tax year. 
  • Most benefits can be payrolled, except:
  • These will still need to be reported on a P11D.
  • For 2026-27, Class 1A NI will still need to be reported on a P11D(b).
  • Employees must be informed in writing if you are going to payroll their benefits. 

See Payrolling of benefits and Mandatory payrolling of benefits from 2027: Briefing

PAYE Settlement Agreement (PSA) calculations 2024-25

What is a PSA?

  • A PSA allows employers to make one annual payment to cover all the tax and NICs due on minor, irregular, or impractical to calculate employee benefits.
  • A PSA stays in place until you or HMRC change or cancel it.

How to submit

Deadlines

  • HMRC recommends that PSA calculations for the tax year ending 5 April 2025 are submitted by 31 July 2025, even if it is a nil return.
  • Payment of Class 1A NI liability must be made by 22 October 2025 (19 October 2025 if not paying electronically).
  • You must include your PSA reference number when making a payment to HMRC. 

Failure to submit

  • HMRC may issue a determination if they do not receive your calculations on time. 
  • This is an estimate of the amount of tax and NI contributions HMRC believes you owe, which could be higher than your calculation. 

See PAYE Settlement Agreements

Taxed Award Schemes (TAS)

What is covered?

  • Non-cash awards, such as non-cash vouchers or benefits provided by third-party companies on behalf of employers. 

Tax implications

  • Tax and Class 1A NI are due. 
  • Providers of such awards should use a TAS to make a payment to HMRC. 

Administration

  • A TAS for awards given in the 2024-25 tax year must be agreed with HMRC by 6 July 2025.

Employee reporting

  • Employees must include the grossed-up value of the award and the tax paid on their Self Assessment tax return. 
  • If the TAS only covers basic rate tax, higher-rate taxpayers may owe additional tax. 

Employment-Related Securities (ERS) returns for 2024-25

Deadlines

  • ERS returns for the 2024-25 tax year must be submitted by 6 July 2025, including nil returns.

Penalties for late filing

  • £100 late filing penalty if the deadline is missed.
  • Additional £300 after three months.
  • A further £300 after six months.

Filing and registration

  • To register for ERS, you need an employer PAYE reference number. 
  • To submit an ERS return, you must have already registered your scheme with HMRC. 
  • An ERS scheme needs to be linked to a live employer PAYE scheme. 
  • If you are closing your PAYE scheme, consider whether to also cease the ERS scheme.

ERS scheme no longer active

  • If a scheme has been registered in error, or it is no longer operating, the scheme must be ceased online. 
  • Only employers can cease a scheme online.
  • A final return is still required for the year in which a scheme is ceased. 

See Employment-Related Securities: Reporting

Extension of NICs relief for hiring veterans

The NICs relief for employers hiring veterans is extended for a further year until 5 April 2026.

  • No employer NICs are due on earnings up to £50,270 during the veteran's first 12 months in civilian employment.

See Employers' NICs relief for veterans

Employers' PAYE and disputed charge

Currently, you can submit disputed charges by calling HMRC's Employers' Helpline on 0300 200 3200 or by writing to them.

  • HMRC will be introducing an online form which will enable you to report disputes on your PAYE liabilities. 

Basic PAYE Tools (BPT)

  • An important maintenance update to BPT was released at the beginning of April 2025 for the 2025-26 tax year. 
  • It is important that you update and use the latest release of BPT, which is version 25.1.
  • As a new customer, before you can use BPT to run your payroll, you must have registered for online PAYE as instructed in your new employer letter. 

Statutory Neonatal Care Leave and Pay

Employed parents of babies admitted to neonatal care now have a day-one right to up to 12 weeks of leave and statutory pay.

  • It includes biological, adoptive, foster-to-adopt and intended parents in surrogacy arrangements.
  • Leave can be taken flexibly, in blocks of at least one week, when the child is still receiving neonatal care, including a week afterwards.
  • After that period, leave must be taken in one continuous block within 68 weeks of the child's birth. 

Further guidance: Statutory Neonatal Care Pay and Leave for employers and Neonatal Care Pay and Leave for employees. 

Future changes to Statutory Sick Pay (SSP)

Key changes

  • The current three-day waiting period will be removed.
  • Employees will receive SSP from the first day of sickness absence.
  • The lower earnings limit will be removed, meaning all employees, regardless of earnings, will be eligible for SSP.
  • Employees will receive 80% of their normal weekly earnings or the flat rate, currently £118.75, whichever is lower.

Next steps

  • The government is seeking feedback from employers and payroll providers to support implementation. 
  • You can contact the SSP Policy Team at This email address is being protected from spambots. You need JavaScript enabled to view it.. 

Further guidance: Employment Rights Bill: factsheets.

Tax refunds and underpayment

HMRC will send many letters in June and July, including:

  • Tax calculation letters.
  • Simple Assessment letters.

If your employees receive one of these letters, the easiest way for them to claim a refund or pay the tax they owe is on the HMRC app.

Parents of teens reminded to go online to extend their Child Benefit claim

  • HMRC are writing to parents to let them know that they must confirm if their teenagers are staying in full-time education or training before the deadline of  31 August 2025.
  • If they do not, their Child Benefit will stop.
  • They can extend the claim by:
    • Using the HMRC app.
    • Scanning the QR code in HMRC's letter.
    • Searching 'extend Child Benefit' and sign into their online account. 
  • If your employees or their partners have opted out because of their income, they should still extend the claim.

Lifetime allowance abolition

For reporting Pension Commencement Excess Lump Sums (PCELS) for the 2025-26 tax year you will need to:

  • Report through Real-time Information (RTI).
  • Set up a separate payroll record.
  • Use 'one-off' pay frequency.
  • Set the payment date as the leaving date.
  • Provide a P45 to the taxpayer.
  • Use data field 219 and include the taxable part in data field 173.

For the 2024-25 tax year, follow the guidance in March 2023 lifetime allowance newsletter.

For reporting Stand-Alone Lump Sums (SALS) for the 2025-26 tax year you will need to:

  • Report through Real-Time Information (RTI).
  • Set up a separate payroll record. 
  • Use 'one-off' pay frequency.
  • Set the payment date as the leaving date.
  • Provide a P45 to the taxpayer.
  • Use data field 220 and include taxable and non-taxable elements in fields 173 and 174, respectively.

For the 2024-25 tax year, follow the guidance in Pension schemes newsletter 151.

Further guidance: 2025 to 2026 CWG2: further guide to PAYE and National Insurance contributions. 

Correcting errors

  • HMRC are aware that not all lump sums are being reported in this way.
  • Guidance on how to correct an individual's tax record can be found in Pension schemes newsletter 170.

Pensions for seasonal temporary staff

  • Employers must assess every seasonal or temporary worker each time they are paid to check if they are eligible for Automatic enrolment.
  • Failure to comply with your workplace pensions' duties may result in a warning notice and ultimately fines if not corrected. 
  • Employers can use postponement to delay assessing staff that are expected to work for less than three months, pausing assessment duties until the end of the three-month period.

See Auto-enrolment: Workplace pensions

Organised labour fraud

What is the risk?

  • Organised Criminal Groups (OCG) are exploiting labour supply chains, which significantly reduces tax payments to HMRC including PAYE, National Insurance and VAT.
  • This can lead to:
    • Reputational and financial damage to your business.
    • Workers being underpaid or denied entitlements like holiday or sick pay. 

Your responsibilities

  • If you use or place temporary labour, you must:
    • Know who pays the workers and how.
    • Ensure PAYE and National Insurance contributions are correctly operated.
    • Avoid relying solely on intermediaries and verify information yourself. 

The following due diligence checks are not a definitive list, but are good practice examples of what you can do to minimise risks:

  • Know your suppliers and umbrella companies.
    • Who they are, how they contract and pay workers.
  • Processes
    • Have a clear process for identifying which workers work through their own Personal Sevice Companies or an intermediary.
    • Check and refresh your due diligence processes regularly.
  • Check for outsourcing.
    • Who is responsible for paying workers?
    • Are taxes being paid correctly?
  • Verify documentation.
    • Ask to see payslips directly from workers.
    • Review PAYE Real-Time Information submissions and employment intermediary reports.
  • Use Companies House.
    • Look for suspicious changes in company names, directors (especially overseas), or description of business activities. 

Reporting concerns

Do not let your contractors get caught out by tax avoidance

  • Anyone working for you as a contractor can find out more about tax avoidance from HMRC's:
    • Online guidance. 
    • Interactive tools.
    • Personal stories from people caught up in tax avoidance.
  • Contractors already in a scheme can:
  • HMRC have a published list of Named tax avoidance schemes and their promoters.
  • HMRC never approves tax avoidance schemes.

New guidance and tools for umbrella companies

New umbrella company guidance:

  • The new guidance outlines examples of good practice for umbrella companies, which:
    • Aims to improve how the temporary labour market functions.
    • Sets out actions supporting compliance. 
    • Encourages a level playing field across the market.
  • Enables workers, businesses, and supply chain stakeholders to understand what a responsible umbrella company operation looks like. 

Updated Work out pay from an umbrella company tool:

  • Generates comprehensive pay and deduction illustrations calculations based on assignment rates.
  • Helps verify if pay and deductions are legitimate and accurately calculated. 
  • Incorporates the 2025-26 financial year rates and thresholds.
  • Is completely anonymous with no collection of identifying details.
  • Supports employment businesses in meeting compliance obligations. 
  • Ensures workers are better informed about their pay entitlements and are protected from tax avoidance schemes.

Use of VAT grouping within the care industry

  • HMRC has identified that some state-regulated care providers are using VAT group structures to reclaim VAT on exempt welfare services.
  • This is considered a form of tax avoidance. 

New VAT group applications

  • HMRC may refuse registration if the structure appears designed to facilitate avoidance. 

Existing VAT groups

  • HMRC is launching a programme to review and investigate known or suspected avoidance schemes. 
  • Organisations currently using these arrangements may want to review their current VAT accounting practices. 
  • There will be no retrospective VAT recovery unless other inaccuracies are found.

See Spotlight 70: VAT grouping structure arrangements used by care providers

End of the Alcohol Duty Stamps Scheme (ADSS)

  • ADSS closed on 1 May 2025.
  • The scheme applied to larger retail containers of higher alcoholic strength products. 
  • Products previously within the scheme no longer require a 'UK Duty Paid' stamp.
  • Producers and importers should now stop stamping retail containers.
  • They should also update their bottle label designs for new stock.
  • Existing stamped stock will remain legal for sale and supply. 

Further guidance: Revenue and Customs Brief: End of the Alcohol Duty Stamps Scheme. 

Using prepaid debit cards for profit extraction to reduce profits and disguise income

What is the scheme?

  • A company buys 'advertising' services, claimed as tax-deductible.
  • Around 80% of the spend is returned to directors or employees as 'loyalty points', loaded onto prepaid debit cards.
  • The recipient can then spend the amounts on these cards as they wish. It is claimed that the 'loyalty points' are not taxable income.

HMRC's view:

  • HMRC considers this scheme does not work and they will challenge anyone promoting such arrangements. 
  • Users may face:
    • Backdated tax bills.
    • Interest and penalties.
    • High scheme fees.
  • HMRC can Help if you think you are already involved. 

See Spotlight 68: Prepaid cards used for profit extraction

Changes to Corporation Tax reminders, statements and receipts

  • From June, HMRC will no longer automatically send paper copies of the following:
    • CT205/A return reminders.
    • CT207 interest statement.
    • CT209 payment receipt.
    • CT603A agent list of issued notices to deliver Company Tax return.
    • CT608 instalment payment reminder.
  • HMRC will also trial no longer sending CT208 Corporation Tax reminder letters before they stop sending them permanently.
  • There are no changes to the Corporation Tax process itself.

See Company Tax: What's New? FY2025

External link

Employer Bulletin June 2025