As the end of the financial year approaches, businesses across the UK are preparing to navigate the intricacies of payroll year-end.
This annual process is vital for ensuring that your business is compliant with tax regulations and that employees receive accurate financial information.
Final reports for the 2022/23 tax year must be submitted to the HM Revenue & Customs (HMRC) by the deadline of 19 April 2023.
Important dates to remember:
- 5 April – End of the 2022/23 tax year
- 6 April – Beginning of the new tax year (2023/24)
- 19 April – Final submission deadline for 2022/23 tax year
- By 31 May – Employees must receive their P60s
Check when your payroll ends
Depending on the structure of the business, your payroll might not end on week 52, meaning you may need to complete an additional pay run.
Staff who are paid weekly, fortnightly or four-weekly are affected by this, and this would mean your payroll ends on week 53, week 54 or 56, respectively.
Monthly payrolls are excluded from this.
Review and update employee information
Before you begin your year-end payroll process, it is essential to review and update employee information, including:
- Personal details (name, address and date of birth)
- Tax codes
- National Insurance numbers
- Student loan deductions
- Pension contributions
Verify that all information is accurate and up to date, as errors could lead to complications and potential fines from the HMRC.
Process new starters or leavers
If you have hired new starters, or employees have left the business during the past tax year, now is a great time to ensure they have been processed correctly.
It is important that this process is complete before submitting your final Full Payment Submission (FPS) or Employer Payment Summary (EPS).
Final pay run
You must complete your final pay run of the 2022/23 tax year before you can process your year-end.
Once you have figured out your last payroll date, processed any leavers or new starters, and authorised the final payroll, you can now send the final FPS and if necessary, an EPS.
Submit your year end
If you have completed the previous steps, you can now submit your final FPS to the HMRC.
This report tells the HMRC to secure the figures for this tax year for each employee.
If you did not pay anyone in the last period before 5 April, then you must submit an EPS.
Prepare employee P60s
P60s are an important part of the payroll process and every employee is legally entitled to this document.
Every employee who is working for your business must receive their P60 which details their pay and deductions for that tax year.
All employees must receive their P60s by 31 May 2023.
Employees who have left your organisation before 5 April 2023 do not receive a P60 from you.
It is important to check and double-check your year-end payroll submissions, as getting them wrong could cause financial problems for both the business and the employees.
Need further advice on your year-end payroll? Get in touch today.