Start or end an exception to mandatory payrolling of benefits
Use this form to ask HMRC to start or end an exception for globally mobile employees from mandatory payrolling of benefits in kind.
From 6 April 2027, as an employer you must report these benefits in kind through your payroll:
- company cars and fuel
- company vans and fuel
- medical insurance
You can apply to HMRC for an exception from mandatory payrolling of benefits in kind for eligible globally mobile employees. This will allow you to report the employee’s benefits through the P11D and P11D(b) forms at the end of the tax year.
Globally mobile employees include those who work, or are likely to work, either:
- both in and outside the UK
- in the UK, and receive benefits or expenses from their employer outside the UK
- outside the UK, and receive benefits or expenses from their employer in the UK
Which employees are eligible for an exception
You may be able to get an exception for your globally mobile employees if their international working arrangements mean both that:
- they are likely to receive benefits or expenses in at least 2 pay periods in a tax year
- you will not have enough information to payroll the benefits or expenses when the employee receives them
Employees are not usually eligible if they only have:
- short-term business travel or remote working outside the UK
- occasional overseas meetings
- other temporary travel arrangements
How an exception changes the reporting of benefits
Starting an exception only changes how and when the employee’s benefits are reported. It does not change the amount of Income Tax or National Insurance due, or the way these are calculated.
You’ll need to report the employee’s benefits through the P11D and P11D(b) forms at the end of the tax year.
An exception will apply to all benefits in kind provided to the employee — you cannot choose to payroll some benefits and report others on a P11D.
The operation of PAYE for globally mobile employees, including EP Appendix arrangements, is not affected by this exception process. Existing PAYE obligations continue to apply.
When to apply for an exception
You should apply for an exception as soon as you become aware that an employee is, or is likely to be, a globally mobile employee.
You cannot backdate an exception.
You must continue to payroll an employee’s benefits until the exception starts on the date you give us on your form.
If you apply during the tax year after payrolling benefits
If you apply for an exception during the tax year and you’re already payrolling benefits, you should stop payrolling benefits from the start date you give us on your form.
The exception continues for the rest of that tax year and to following years, unless you’ve either:
- given us an end date on the form
- told us that you’re ending the exception
When to apply to end an exception
You should apply to end an exception as soon as you become aware that an employee will no longer be eligible.
You do not need to tell us about ending an exception if you gave us an end date when you applied and the employee remains eligible for the whole period of the exception.
Use the form to end an exception, if either:
- you have not given us an end date when applying
- an employee’s circumstances change and they are no longer eligible
An exception can only end at the end of a tax year (on 5 April).
You’ll need to report the employee’s benefits through the P11D and P11D(b) forms at the end of the tax year that includes the end date.
If you continue to give your employee benefits in kind after this tax year, you must report them through your payroll from 6 April of the following tax year.
What you’ll need
You’ll need your:
- business name and address
- PAYE reference — you can find this on PAYE letters from HMRC, in the format 123/AB456
You’ll also need each employee’s:
- full name
- National Insurance number, if they have one
- date of birth if they do not have a National Insurance number
- payroll or works number, if available
- exception start date (if applicable) — this must be on or after the date that you submit the form
- exception end date, if known or applicable
If you do not add an end date when applying for an exception, it will remain in place until you send another form to tell us it has ended.
To make sure that your application is processed correctly, check that:
- the employer details match the details we hold
- the employee details match the details we hold
- the employee has an active employment record
- there’s an existing exception (if you’re trying to end an exception)
Your application may be delayed or not processed if it contains errors.
Apply online
You’ll need to sign in to apply to start or end an exception. If you do not already have sign in details, you’ll be able to create them.
You can save your progress and return to the form. If you do not submit it within 28 days you’ll need to start again.
You can include an unlimited number of employees on one form, by adding them separately, or uploading a spreadsheet (a template is provided in the form) with all the employees’ details.
After you submit your form
After you submit your form, you’ll get an email with your application reference.
Treat the employees included in your form as exceptions from the start date you’ve given us on the form. You will not need to payroll benefits and expenses for the employees covered by the exception.
We’ll only contact you if we cannot process your application.
If we cannot process your application
We may not be able to process an application that does not match the details we hold.
If a form includes more than one employee, we may be able to process some employees and not others.
We’ll contact you about any employee records that we cannot process and explain what you need to do.
If you need to correct or change a form
You cannot change any details on the form after you’ve submitted it.
If you need to correct a form or change details after you apply (for example, due to a delay in an employee’s start date), you’ll need to send in a new form with the changed details.
Keeping records
You’ll need to keep a record of:
- the employees included on the form
- the information submitted for each employee
- the date you submitted the form
- your application reference
- any letters or other communications received from us
This will help you:
- identify which employees you’ve asked us to treat as exceptions
- respond if we cannot process an application
- show that an employee is eligible for an exception