02 December 2025
Today HMRC has published draft interim guidance and legislation to aid preparation for reporting benefits in kind (BiKs) and expenses in real time, through payroll software, from April 2027.
The content of this guidance includes:
- Introduction
- Who should read this
- The default operation of mandatory payrolling
- Reporting requirements
- Getting ready for mandatory payrolling of benefits in kind
- How to report a benefit in kind in real time
- What happens when the full amount of tax cannot be collected either within a pay period or tax year
- Reporting Class 1A National Insurance contributions
- Dealing with employees who leave during the tax year
- Penalties and interest
- Mergers and acquisitions
- Moving employees from one payroll to another
- Payment reference numbers, P60s and P45s
- Future updates and timeline of delivery
- What to do if you have questions or concerns
- Annex 1 – payrolling examples for different scenarios
- Annex 2 – draft legislation
- Annex 3 – additional benefits in kind fields likely to be required on Full Payment Submission returns
The policy team will be reviewing the guidance in detail, and we will report on what you need to know.
Information provided in this news article may be subject to change. Please make note of the date of publication to ensure that you are viewing up to date information.