What is payroll year end?At the end of the tax year, businesses must submit end-of-year declarations to HMRC. Employees should be issued with a P60, which is a statement for taxpayers summarising the tax paid throughout that year. The end of the tax year in the UK is 5 April, but employers have until 31 May to issue P60s.
Finish this year?s payrollsSend final Full Payment Submission (FPS) ? this is a form that reports to HMRC what payments have been made to employees, and what deductions have been made. The deadline is on or before your employee?s payday. You can submit this earlier, but don?t get ahead of yourself. It may seem like you?re ticking off chores, but if any information changes after you?ve sent it ? for example, if someone resigns or changes tax code ? you will need to send a corrected FPS. In the next tax month, you will be able to view how much tax and National Insurance is owed via your HMRC online account. Send the final Employer Payment Summary ? Reductions can be claimed by sending an Employer Payment Summary (EPS) and then the balance must be paid. EPS reductions include things like such as paternity or maternity pay, the Apprenticeship Levy, and Employment Allowance. You should also send an EPS instead of an FPS if no employees have been paid in a tax month. If you pay late, you can expect an notice online or a letter from HMRC. Interest is charged daily at 2.75 per cent, and you will be charged a penalty. Provide P60s for current employees ? P60s are required for every employee who is working for you on 5 April. You can order copies of the P60 forms from HMRC directly, or sometimes if you are using accounting software you can simply create a PDF to send out to employees. This must be completed by 31 May.
Start the next tax year?s payrollsAnd now the fun begins all over again. When preparing for the next tax year, businesses need to prepare a payroll record, identify the correct tax codes for the new year. Your software may automatically prompt you to do this. Lastly, update your payroll software, and ensure you are using the correct version of the Basic PAYE Tools. Want more help with your company?s year-end payroll? Learn more about how Sage could help with its suite of services.
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