A payroll professional in the UK has several key responsibilities as part of the UK payroll year-end process.
Here’s a checklist of things to consider and actions to take when closing the payroll year on payroll software:
Reconcile Payroll and Review for Errors
The first step is to perform some reconciliations before finalising the year.
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Compare the payroll figures against finance reports and HMRC submissions to ensure accuracy.
How to Check Year-to-Date Figures -
Check for any underpayments/overpayments and make necessary corrections before the final submissions.
Final Full Payment Submission (FPS) & Employer Payment Summary (EPS)
Then, perform a final review and submit the latest FPS and EPS to HMRC.
- Ensure any leavers are marked as such in the final payroll run.
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Issue P45s to leavers when necessary.
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- Ensure all payroll records are accurate for the tax year.
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Submit the final FPS to HMRC before or on 5th April (the last payday of the tax year).
- Buddy automatically includes the 'final' flag for the last payroll of the year
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If adjustments are needed, submit an EPS (e.g., for reclaiming statutory payments, reporting Employment Allowance).
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If you are claiming Employment Allowance, make sure to enable this from settings: Enabling Employment Allowance through Buddy's EPS Submissions
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Process and Issue P60s
Once the data has been finalised and submitted, it's time to start sending Tax Forms to your employees.
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Generate and distribute P60s to all employees on payroll from 5th April.
See: Sending P45s and P60s to Employees -
Ensure P60s have been issued by 31st May.
Prepare for the New Tax Year (6th April Onwards)
As soon as a tax year ends, a new one begins!
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Update employee tax codes for the new tax year (e.g., applying new codes from HMRC’s P9 notifications).
Getting Notifications -
Apply new changes to National Minimum Wage (NMW) and National Living Wage (NLW) if applicable.
Plan for Payroll Deadlines in the New Tax Year
Stay up to date and ensure your practices are more than ready for a successful year.
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Stay updated with upcoming legislative changes, such as
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increases to pension contributions
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changes in tax rates or student loan thresholds
- general updates in bureau practices to ensure customer success
- product updates at Buddy: Buddy Release Notes
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Communicate with Clients and Employees
A key part of payroll success is communication and ensuring that employees access their documents with clarity and ease.
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Inform employees about changes in tax codes, pay adjustments, and their P60s.
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Provide guidance on accessing their documents via self-service portals if available.
Final EPS Deadline for the Tax Year
The final EPS for the tax year must be submitted by 19th April following the end of the tax year (which ends on 5th April).