For many businesses, the end of the financial year can be a stressful time. With payroll deadlines to meet and multiple changes to consider, it’s important to have a plan in place to ensure that you stay compliant and have a smooth transition from one financial year to the next.
Here are 7 key things to focus on for a successful payroll year end:
1. Final Payroll Check: It is important to run a final check of your payroll data before the start of the new financial year. This includes creating reports that detail payment totals and any variations over the course of the year, so you can ensure all data is accurate and up-to-date.
2. Submit End-of-Year EPS: The deadline for submitting your End-of-Year EPS (Employer Payment Summary) to HMRC is 19th April, so make sure you get this done as soon as possible!
3. Create New Payroll Year: Make sure you create a new payroll year with your software, ensuring that all allowances, deductions, and other data is correct and up-to-date according to HMRC standards.
4. Update Tax Codes: Ensure your software has applied any P9 tax code notices from HMRC and sense check tax calculations prior to running a payroll for the new year.
5. Uplift Employee Pay Rates: Make sure employee pay rates comply with the National Minimum wage from 1st April onwards - don't forget about staff who are eligible for National Living Wage too!
6. Create & Distribute P60s: P60s must be created and distributed by 31st May each year - no exceptions!
7. Send Out P11D Forms: Don't forget about employee expenses - make sure you prepare and send out P11D forms by 6 July each year so that they can complete their own tax returns accordingly.
By following these seven steps, you can help keep your business compliant at year end, whilst also keeping employees informed of their rights and responsibilities throughout this process.
With careful planning ahead of time, you will find that preparing for payroll year end will become much less daunting once it rolls around in April!