Moving payday to a different day of the week/month

Changing the day or date on which you pay your employees can have PAYE implications if it means that two paydays fall within the same tax week or same tax month. This guide assumes that the pay interval - for example, monthly/weekly - stays the same. If the interval changes, read HM Revenue & Customs (HMRC's) guide 'PAYE procedures if you change the interval between paydays'. A link is provided at the end of this guide.

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National Insurance contributions: no change

Moving your payday only affects PAYE tax, not National Insurance contributions (NICs). You should continue to work out your NICs deductions as usual, using the normal earnings period both for the final payment on your old payday and for subsequent payments on your new payday.

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PAYE tax: check which tax periods your payments fall in

To work out how much PAYE tax to deduct when changing your payday, first check whether your first new payday payment falls in the same tax period - week or month - as the last payday payment, or in the subsequent period. You can check this in Part 4 of HMRC's Employer Helpbook E13, 'Day to day payroll'.

Go to Employer Helpbook E13, 'Day to day payroll'

When payments fall in subsequent tax periods

If your first new payday falls in the tax week or tax month that follows the one in which your last payday payment fell, then you don't need to do anything. Continue to operate PAYE as usual.

When payments fall in the same tax period

If the first new payday falls in the same tax week or tax month as the last of your old paydays, then you need to treat the first new payment as an extra payment for the week or month in question.

If you use commercial payroll software to maintain your payroll records, many packages will handle this automatically for you. HMRC's free P11 Calculator in the Basic PAYE Tools package can't currently process a change in an employee's payday. If you've been using the Calculator and you change your payday so that two payments fall in the same tax period, you'll need to switch to a commercial software package with this functionality or to a paper form P11 for the employee.

If you’re using a paper form P11, you’ll need to:

  • update column 2 'pay in the week or month' and column 3 'total pay to date' to reflect the increased pay in that tax week or tax month
  • leave the free pay figure in column 4a unchanged, as only one amount of free pay can be given in any one pay period
  • amend the remaining columns on the PAYE side of the P11 using these updated figures

This amendment to the P11 is a one-off process at the time of the transition between your old and new paydays. For subsequent payments on your new payday, operate PAYE and update your payroll records as usual.

Find out about completing a paper form P11

PAYE procedures when changing the interval between paydays

Download CWG2, 'Employer Further Guide to PAYE and NICs' (PDF 492K)

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