Our accountancy team have prepared a step-by-step guide to getting your payroll in order for year end. Following this process will ensure that the data you give to HMRC is accurate and you are compliant with employment law, meaning your business will enter the new tax year in good financial health.
It will also ensure that the payroll information you have for your staff is accurate and they are kept well-informed.
Read through the steps below and give our team a call if you have any questions:
- Check for any amendments to your staff contracts which may affect 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.
- 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. N.B. You must complete your redeclaration 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 by up to £5000, if you are eligible
- Check your National Insurance Contribution rates are set at 13.80% for employers and 12% for employee contributions.
- The Secondary Threshold National Insurance (Director Minimum) for 2023-2024 remains at £758 per month (the same as 2022-2023)
- As National Insurance rates and the Primary threshold changed during the 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 2023.
- Check that you have been reimbursed for any Statutory payments, such as Statutory Maternity Pay, and the 2023/24 Statutory rates have been updated.
- Report employee benefits and expenses using P11D by 6th July 2023
- An additional Bank Holiday will take place on 8th May 2023 to mark the Coronation of His Majesty King Charles III. Your employees may be entitled to paid time off. This will depend on the wording of each employee’s contract of employment.
We suggest that you check the wording of your employees’ contracts and communicate clearly with employees about whether or not they will be required to work on the additional Bank Holiday, whether it will be treated as an extra paid day off (awarded in lieu in the event that they are required to work), or whether they will be required to use some of their floating annual leave. You may want to bear in mind the arrangements you made for the Queen’s Jubilee bank holiday in 2022.