Dispense with the routine

We want to help you reduce the amount of information that you need to report to us.
There are many circumstances where it’s possible for an employer to be excused from reporting certain expenses or benefits in kind.

Dispensations

A dispensation (PDF 35K) (which covers both tax and National Insurance contributions) is a notice from your HMRC office that saves you from reporting expenses and some benefits in kind on a P11D or P9D. Dispensations can only be granted for expenses or benefits in kind where there is no liability to tax or NICs. Your local HMRC office will need to confirm this before granting a dispensation.

A dispensation also helps your employees. They do not have to include details of the expenses and benefits in kind covered in the dispensation on their tax returns, and they are not included in either a tax assessment or a PAYE Tax Code.

PAYE Settlement Agreements

A PAYE Settlement Agreement (PSA) is a voluntary agreement between you and your HMRC office that allows you to meet the tax payable on certain expenses and benefits in kind you provide to your employees.

Note from the editor:

If you have applied for a Dispensation or a PSA and would be willing to share your experiences with us, then please drop me a line.