In this section:
If an employee's regular payday falls on a non-banking day (a Saturday, Sunday or bank holiday) and you pay them on the last working day before their regular payday, or the next working day after their regular payday, you may still treat the payment for PAYE (Pay As You Earn) purposes as having been made on the regular payday. For National Insurance contribution (NIC) purposes you must treat the payment as having been made on the regular payday if both the actual and normal paydays fall in the same tax year.
For example, if payment was normally due on Monday 5 April 2010 (Easter Monday - which is in tax week 53) but you pay it instead on Thursday 1 April 2010 (which is in tax week 52), it must be treated as having been paid on Monday 5 April for NICs and may also be treated as if it had been paid on Monday 5 April for PAYE purposes.
If you operate a manual payroll system, and your last payday falls on the 5 April there is more guidance on payments made in week 53 in the 'Employer Further Guide to PAYE and NICs' - there's a link to it at the bottom of this guide.
This system for dealing with paydays that fall on non-banking days can also apply for cases when the regular and actual paydays fall in different tax years. For example, a payment due on Sunday 6 April 2008 (which was in the 2008-09 tax year) but paid on Friday 4 April 2008 (which was in the 2007-08 tax year) would have been treated for PAYE tax and NICs purposes as having been paid on 6 April and so in the 2008-09 tax year.
A set of Basic PAYE Tools are now available to download straight to your computer. In addition to the P11 Calculator, the tools include:
Download Basic PAYE Tools from the Business Link website (Opens new window)
More about using the using commercial payroll software or HMRC's downloadable P11 Calculator
How to complete form P11 using paper-based methods
Download CWG2, 'Employer Further Guide to PAYE and NICs' (PDF 1.3MB)
