Loans to Employees 25/07/2010
The same question keeps cropping up time and time again "do we need to report to H.M Revenue & Customs a loan to an employee" At Advanced Payroll Services we will always manage all your payroll services needs but for your information if the loan is for less than £5,000 or the employee earns less than £8,500 then you need not do anything. If it's to a company director or an employee earning more than £8,500 and it's more than £5,000 it needs to be reported as a beneficial loan on form P11d. The employee will be taxed on the interest rate currently at 4% and the company will need to pay class 1 NICs on the benefit. Advanced Payroll Services will do this for you as part of your payroll services package.