Payroll Year End process
Year End Processed
As we’re just past the end of the tax year, now’s the time to be planning to run your payroll year end to get ready for the new tax year.
By now if you pay your employees monthly you should have posted the final pay of the 2018-2019 tax year. If you pay your employees weekly, fortnightly or four weekly and your final pay date falls on the 5thApril, then you will have a week 53.
Once you have processed your final payroll for the tax year, you then need to check for leavers, as they need to be processed before making your submissions to HM Revenue and Customs.
Once you’ve dealt with any leavers, you will then need to send your final FPS to HMRC, which needs to be done by the 19thApril. If required you should also file your final EPS of the year.
Following the submissions you should then process your year end. You need to ensure you check the processing date, as this needs to be set to the 5 April. Your payroll software should take you through the steps to process your year end, and to make your final submissions for the tax year.
Once this has been done you can produce your P60s and pass them to your employees. Remember that your employees should receive their P60s by 31 May.
Prepare for the New Tax Year
Once you have processed the payroll year end you can then look forward to set up the payroll for the new tax year.
Firstly you should review employee tax codes for the new tax year. Much payroll software will automatically update certain tax codes, but it’s always worth checking that they have been updated correctly and to what you expected.
As the pension contributions increase on the 6thApril to 3% for the employer and 5% for the employee, these should be updated in your payroll software, or if your software updates them automatically, check them to ensure that they have been updated correctly.
You should also check that your employees National Insurance Category are correct.
If you are a small employer then it is worth checking that the “small employers’ relief” button is ticked. This will ensure that you receive the extra 3% relief on any Statutory Maternity Pay (SMP), Statutory Paternity Pay (SPP), Statutory Adoption Pay (SAP) and Shared Parental Pay (ShPP) paid in the year.
If you are eligible to claim Employment allowance then you should check in your payroll software to ensure that you have selected any tick boxes to ensure its being claimed. In some payroll software you will need to send an EPS which notifies HMRC that you’re claiming the allowance.
Following the above processes should ensure that you have a smooth payroll year end and start to the next payroll year.
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