With payroll year end round the corner, our accountancy team have prepared a step-by-step guide to getting your payroll in order and ensuring you enter the new tax year in good financial health. Follow our simple checklist to ensure the data you give to HMRC is accurate, your staff are kept well-informed and that you remain compliant with employment law.
Follow our simple steps to compliance:
- Check for any amendments to your staff contracts which may impact payroll.
- Check that your employees have been informed regarding the upcoming increase in the National Minimum Wage:
- Ensure that all your employees’ data is up to date for the coming year.
- Update your tax codes and employee contact details.
- Check that pension thresholds have been set to qualifying earnings or gross salary (depending on the agreement you have with your employees and the software you use for payroll).
- Ensure your pension contributions have been accurately submitted to your pension provider during the year.
- Most cloud-based payroll software are designed to synchronise with pension providers so that monthly pension submissions can be automated.
- Ensure that you comply with pension regulations and check when the next pension re-enrolment date is. Ensure you have completed your declaration or redeclaration (you must complete your re-declaration of compliance within five months of the third anniversary of your automatic enrolment staging date).
- Reconcile the amounts payable to HMRC and your pension funds.
- Check you have claimed your Employment Allowance to reduce your annual National Insurance liability for previous years. You can claim back for previous tax years, if you are eligible.
- Employment allowance for 2026-2027 is £10,500 and the £100,000 threshold for eligibility was removed last year. All other eligibility requirements remain unchanged.
- Check your National Insurance Contribution rates are set at 15% for employers. Secondary threshold has been reduced from £9,100 to £5,000 for Employer National Insurance contributions. These are frozen till 2028/2029 fiscal year.
- Ensure you manually check at year end that Employer and Employee National Insurance deductions are accurately calculated. For directors check if they have used the Annual method or the Cumulative earnings method.
- Check all RTI (Real Time Information) submissions have been duly filed and you have informed HMRC of your final submission at year end (month 12). Your RTIs should automatically go every month, but it’s best to check that no errors are reported in your payroll software.
- Some payroll software may require you to file P45 submissions separately. Check these have been submitted.
- Back up and download P60s and make them available to your employees before 31st May 2026.
- Check that you have reclaimed any Statutory payments, such as Statutory Maternity Pay, Statutory Sick Pay etc.
- Check all Salary Sacrifice Schemes are up to date and report employee benefits and expenses using P11D by 6th July 2026. Get in touch for more information on our partnership with Octopus EV Salary sacrifice scheme.
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