The end of one financial year, and the start of the next marks a key date in the payroll calendar. It’s a crucial time for UK companies to stay organised and compliant. If you’re an employer responsible for processing your own payroll, you’ll soon discover how slick your processes are and how robust your systems are.
If you find it causes a major headache, it’s a sign you don’t have as much control as you should (and need). If it’s a smooth, manageable process, then keep up the good work!
So to get you started, here’s our step-by-step guide to make the change of the payroll year straight-forward:
FINALISE PAYROLL PROCESSING
Ensure that all pay runs for the current year have been completed accurately, including any adjustments or bonuses.
CHECK FOR LEAVERS
If they left in the current tax year a P45 will need to be issued. This will ensure correct year to date figures are processed when generating their P45. (If you don’t mark them as a leaver they will be classed as your Employee still and be issued a P.60. If you mark them as a leaver in 24/25 they will be issued a NIL P45 for the next financial year 24/25).
REVIEW YEAR-END PAYROLL REPORTS
Generate and review year-end reports such as P60s, P11Ds, and payroll summary reports to ensure accuracy and compliance with HMRC regulations.
UPDATE EMPLOYEE RECORDS
Make sure all employee information is up to date, including personal details, tax codes, and bank account information.
REVIEW HOLIDAY PAY
Review the previous year for any employee accrued holiday pay and ensure this is notified and repaid to the employee.
SUBMIT YEAR-END EMPLOYEE DECLARATIONS
File necessary year-end declarations with HMRC, such as the Employer Annual Return (P35) and P60 forms for each employee. P60s must be sent by 31st May 2024.
PREPARE FOR THE NEW TAX YEAR
Check your PX9 which contains thresholds, rates and tax code increases for both employers and payroll providers. This ensures you have everything you need for your payroll records and tax codes for the new tax year. Make sure your payroll software reflects your PX9 report.
CHECK STATUTORY PAY
The new financial year welcomes in a raft of increases to statutory pay including national minimum wage increases, maternity pay and statutory sick pay (to name a few). Make sure your payroll reflects these.
COMMUNICATE CHANGES
Inform employees of any changes that will affect their payroll in the new tax year, such as tax code updates or pension contribution adjustments.
SETUP NEW PAYROLL PERIODS
Create payroll schedules for the new tax year, including pay dates and deadlines for submitting payroll data making sure the pay date is 6th April onwards.
REVIEW PENSION CONTRIBUTIONS
Ensure that pension contributions are calculated correctly and comply with auto-enrollment requirements.
CONDUCT PAYROLL RECONCILIATION
Reconcile payroll data for the previous year to identify any discrepancies or errors that need to be corrected.
PLAN FOR EMPLOYEE BENEFITS
Review employee benefits packages for the new tax year, including any changes in benefits or contributions.
SUBMIT YOUR FINAL EPS
Once you have completed all other checks, submit your final Employer Payment Summary (EPS) to finalise your payroll information with HMRC for the previous financial year.
If you’re left feeling totally bemused and overwhelmed by the process, contact the BoostPay team and we’ll be happy to answer any questions you have.
