Payroll Year-End – What do you need to do?

With the end of the tax year fast approaching on 5th April, make sure you know what payroll tasks you need to do to start the year right.

Payroll is based on the tax year, which runs from 6th April to the following 5th April, and an employee’s pay details for the tax year are based on payments made during that year.

Send your final payroll report to HMRC

All employers need to submit their payroll details electronically to HM Revenue and Customs (HMRC) on or before the employees’ pay date. You should send your last electronic Full Payment Submission (FPS) using your payroll software. Most software providers do this automatically.

Give your employees a P60

A P60 is a document that tells your employees how much they have earned during the tax year and how much tax they have had taken off at source, through Pay-As-You-Earn (PAYE). Employees might need this information if they are required to submit a tax return. You should give a P60 to all employees who are working for you on the last day of the tax year (5th April). You don’t need to give a P60 to employees who have left during the tax year – they can get the information they need from their P45 that you gave them when they left. You must give employees their P60 by 31 May.

Update your employees’ payroll records and tax codes

The standard tax code for employees in Scotland is S1257L for the tax year 2023/24. This hasn’t changed, so for most employees, you won’t need to update your payroll records, and their previous code will roll forward.

For employees with a tax code other than S1257L, HMRC will send you a new tax code that you need to use. You need to update your payroll software with this new code to make sure that you are deducting the right amount of tax from your employees’ wages.

It’s a good idea to check that you have the correct address details for all your employees at this time of year too. You might also need to update your payroll software, to make sure that the rates and allowances for tax, National Insurance and student loan deductions are correct for the new year.

Report expenses and benefits to HMRC

If you provide your employees with benefits, such as a company car, you need to report this to HMRC by 6th July using the online reporting service. You also need to pay any Class 1A National Insurance Contributions due on benefits and expenses to HMRC by 22nd July.

Talking Numbers Accountancy and Bookkeeping can help to take the stress out of running your payroll. We offer competitive, transparent pricing for weekly, monthly and four-weekly payrolls, meaning that you can spend time focusing on running your business. We can take care of tax codes, earnings orders, holiday pay, pension duties and all the other tasks that come with running a payroll. Get in touch today for a free, no-obligation consultation.

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