Expenses and benefits: car parking charges
What to report and pay
If the parking charge is not exempt, you must report it to HMRC. You may have to deduct and pay tax and National Insurance on it.
Contracts with parking providers
If you have a contract with a parking provider and you pay them directly, you’ll need to:
- report on form P11D
- pay Class 1A National Insurance on what you pay for the parking
If your employee has a contract with a parking provider and you pay them directly, you’ll need to:
- report on form P11D
- add what you pay for parking to their other earnings, and deduct and pay Class 1 National Insurance (but not PAYE tax)
Parking charges as earnings
If you give your employee money to pay for parking charges, it counts as earnings and you must:
- add it to your employee’s other earnings
- deduct and pay PAYE tax and Class 1 National Insurance using payroll
Salary sacrifice arrangements
If the cost of the parking charges is less than the amount of salary given up, report the salary amount instead.
These rules do not apply to arrangements made before 6 April 2017 - check when the rules will change.