Check list - Preparing for year end

Modified on Tue, 10 Dec at 3:10 PM

The year-end process has been made a lot simpler since the introduction of Real Time Information (RTI) and you will be balancing the value paid over to HMRC each period. If there are differences between your payment and the RTI then HMRC will have made contact.

The processes that may be slightly different for year-end and explains the statutory processes to complete the tax year end and open the new year. It includes some tasks that you will need to do for the new year.

Important dates in the payroll calendar

There are a number of key tasks you must complete in the period around the end of the tax year on 5 April. The key end of year requirement for most employers is to submit their final Full Payment Submission (FPS) for the tax year, and where appropriate Employer Payment Summary (EPS), with the final submission indicator set.

Deadlines at a glance

Deadline	Task
Final Pay Day	Send your final FPS for the last payroll in the tax reference on or before the employee’s last payday of the tax year. Do this for each payroll in your PAYE scheme reference. The last deadline for any FPS for the tax year is 19 April. After this, any submissions must be made as an End of Year Update (EYU) via HMRC tools.
19 April	Send your final EPS for the year for each PAYE scheme you operate. This submission will be marked Yes in the Final Submission for year option.
31 May	Give each relevant employee a form P60
6 July	File expenses and benefits annual return (forms P11D, and P11D(b)) if applicable - give a copy to your employees This is the last date for your form and forms P11D, or substitutes. P11D(b) to reach your HMRC office.
19 July	Class 1A NICs - postal payments must reach your HMRC Accounts Office
22 July	Class 1A NICs - cleared electronic payments must reach HMRC bank account

Year End Process

1. Submit your final RTI submissions for the tax year	The standard pattern of sending a Full Payment Submission (FPS) every time you pay your employees continues at the end of the tax year. The only difference is that on your final EPS submission there is a declaration which also confirms that this is the final submission for the tax year. Your RTI submissions comprise of: a form FPS which provides HMRC with a breakdown of the PAYE and NICs calculation for each of the employee on each payday. a form Employer Payment Summary (EPS) which enables you to report the amounts of Statutory Payments Recovered, NIC Compensation on Statutory Payments, CIS Deductions Suffered or NIC Holiday so that HMRC can offset these against the payments you are due to make.
2. Give a P60 document to each relevant employee	You must provide a form P60, which can be either paper or electronic to each employee who was working for you on the last day of the tax year (5 April) and for whom you were required to maintain a payroll record. The P60 summarises the employee's total pay and deductions for the year. If an employee has had more than one period of employment with you during the tax year, only provide the employee with one P60 - the P60 should only be for the period of employment up to and including 5 April. If an employee asks for another copy, you may issue a duplicate. If you need to make an amendment to the details shown on the original P60, you must give your employee details of the amendment. You can give them a letter showing the amendment or a new P60 marked REPLACEMENT. This replacement P60 can be provided either on paper or electronically. Important You must give your employees their P60s by 31 May.
3. Complete and file expenses and benefits forms	You must complete and file either a form P11D for any employees to whom you've provided expenses and benefits during the tax year. You must also file a form P11D(b) to declare the overall amount of Class 1A NICs due on any of the expenses and benefits you've provided. For more information about P11D submissions, see How Do I Produce P11D Submissions for Whole Pay Scheme? or How Do I Produce P11D PDFs for Individual Employees? Important All of these forms must reach HMRC by 6 July.
4. Pay any Class 1A NICs due on expenses and benefits	You must send HMRC any Class 1A NICs that are due on the taxable expenses and benefits you've paid or provided. If you're sending payment by post, it must reach your HMRC Accounts Office by 19 July. If you're sending payment by an approved electronic method, your payment must be cleared in HMRC's bank account by 22 July. Interest will be charged on amounts not paid by these dates. Once the year-end return is complete, certain actions are required to progress into the new tax year. For the current HMRC important dates go to http://www.hmrc.gov.uk/employers
5. Move to new tax year	Simply move to the Next Payroll Period after the last period in the tax year places a payroll in the new tax year.
6. Apply tax code uplifts	It is possible, arising from budget changes that the HMRC will advise you to make a general uplift of employee tax codes. The uplift notice will detail which suffixes are applicable together with the revised rate. Cintra will advise you of the relevant uplifts that you will need to input. For more information about tax code uplifts, see How Do I Create Tax Code Uplifts in Cintra iQ?
7. Set up Apprenticeship Levy Allowance	Within Cintra iQ, you can create payment runs to pay tax, employee and employer NI, and student loan deductions to HMRC. The payment runs are created by the P32 period. Therefore, if you have more than one payroll under a tax reference, all payments due to HMRC are created in one run. As part of this process, the EPS (Employer Payment Summary ) file is created and submitted to HMRC. The EPS file displays employer payments that are due such as tax, NI etc. For more information, see How Do I Allocate Apprenticeship Levy (AL) Allowance to PAYE Schemes?
8. Claim Employment Allowance	If you are eligible and want to claim the £4000 employment allowance, then set to yes and remember to check that the sector is correct. For more information about employment allowance, see How Do I Claim Employment Allowance?
9. Set up Pension Bands	If you operate Banded Pension Schemes for Salary Related Contributions, you need to ensure that the Employee Pension Scheme contribution sets and rates are created within Cintra iQ. For more information, see How Do I Create Pension Bands for Employee Pension Contributions?

HM Revenue & Customs Penalties

Strict penalties are applied should you miss any of the HMRC deadlines and interest is also chargeable until your settlement is received. Therefore it is very important that you keep in contact with HM Revenue & Customs, particularly if you expect to miss a deadline. For the monthly payment of Tax and NIC, if the 19th (Cheques) or 22nd (Electronic payments) is missed then you will be automatically charged interest at the current rate.

Small Employer's Relief

Qualifying for Small Employer Relief for SAP, SMP, SPP, SHPL/SHPP, involves a complete knowledge of the total National Insurance liabilities of your organisation. As not all such liabilities may be processed by Cintra iQ, Cintra iQ itself cannot determine this qualification for you.

To qualify for Small Employer Relief (SER), your annual liability, as an employer, for National Insurance must be £45,000 or less. If you are unsure as to whether this applies to your organisation, please contact your local HMRC office. Your regular Cintra iQ upgrades will ensure that the correct rates for Small Employer Relief are applied, but you must decide whether Small Employer Relief is to be applied in any given tax year.

Employers who qualify for SER can recover 100% of the SMP that they have paid their employees plus a percentage as compensation. The current rate can be seen in the Statutory Tables.

Go to Cintra iQ : Payroll> Payroll Setup> Statutory Rates> Child Related Benefit Rates