As an employer, if you operate PAYE (Pay As You Earn) there are a number of important tasks you need to complete around the end of the tax year (5 April).
You must make sure that you submit your final Full Payment Submission (FPS) and/or Employer Payment Summary (EPS) for the final pay period in the tax year. HM Revenue & Customs (HMRC) uses the information that you send to make sure that you and your employees have paid the right amounts of tax, National Insurance contributions (NICs) and student loan deductions for the tax year. The information is also used in the calculation of entitlement to state benefits, tax credits and pensions.
This guide tells you what to do - which may be different to what you've done in past years - and the deadlines you'll have to meet.
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From 6 April 2013 employers started reporting PAYE information to HMRC in real time. You must report your payroll information by submitting an FPS and EPS. Don't try to send forms P35 or P14 for 2013-14 or later tax years - if you do they'll be rejected. You can still send an amended form P35 or P14 for a previous tax year when you reported information using forms P35 or P14.
At the end of the tax year, submit your final FPS and/or EPS for the pay period as normal - on or before the date you pay your employees.
For most employers, this means you will send your final FPS on or before your last payday in the tax year, which ends on 5 April.
HMRC has produced 'step-by step' and 'at-a glance' guides which go through the following steps in more detail. You'll find links to these guides at the end of this section.
The steps to sending your final submission are as follows:
1) Identify your final submission
For most employers, the final submission will be the final FPS. This is the one telling HMRC about the very last employee payment for the tax year. The tax year ends on 5 April so, for most employers, their final submission will be made on or before that date on an FPS. So, for example, if you pay some employees weekly and others monthly, your final submission is the last one of these.
You must do this even if you have not made any deductions of PAYE tax or NICs from your employees in that pay period.
If the timing of submission of multiple FPS is unclear you can use an EPS to report the 'Final submission for the tax year', and answer the questions, after all your FPS have been successfully submitted.
Before sending your final submission, you must make sure that we have successfully received all earlier submissions. Your payroll software tells you when submissions have been successful.
If you don't pay any employees in the final tax month of the tax year send HMRC your final submission on an EPS - see the later section in this guide 'If you made no payments in the final pay period'.
2) Indicate your final submission
On your last FPS or EPS for the year you must also:
3) Send your final submission as normal
The same time limits apply to final submissions as they do for normal submissions. So, unless an exception or relaxation applies, you should send your final submission on or before the date of your last employee payment in the tax year (or by 19 April if you are sending an EPS).
If you don't make your final submission for 2013-14 on time you may get a penalty.
Your payroll software will tell you whether your submission was successful, so you don't need to ask HMRC whether it has been received.
HMRC's short 'step-by-step' flowchart:
HMRC's 'at-a-glance' guide:
If you make final payments to your employees in, say, tax month 10 and you indicate on that FPS that it is your 'Final submission for the tax year' and answer the end-of-year questions and declaration, you must still submit an EPS by completing the 'No payment dates' or 'Period of inactivity' fields to show that you won't be sending an FPS for tax months 11 and 12.
If you've submitted your final FPS - and where appropriate an EPS - for the tax year, but haven't indicated that this is your 'Final submission for the tax year', you submit an EPS indicating that it's your 'Final submission for the tax year'. You must also complete the end-of-year questions and declaration.
You don't need to send another final FPS - just a final EPS is required.
If you are a new employer, who claimed the NICs holiday before the scheme ended on 5 September 2013, you must read this guidance in conjunction with the guidance on completing the NICs holiday end-of-year returns.
Do not confirm this is the 'Final submission for the tax year' if your PAYE scheme has ceased. Instead, you should use the 'Ceased indicator', and show the date the PAYE scheme ceased:
If you have not made a payment to any of your employees in the final pay period for the tax year then you are not required to submit an FPS. Instead you must submit an EPS, by 19 April following the end of the tax year, indicating the following:
Don't wait until the end of the tax year to report corrections. If you make a mistake on an FPS or you discover that information you have already reported is incorrect, you should correct it as soon as you discover the error, during the tax year, on the next FPS. You can find out more about what you need to do to correct payroll information in the current tax year in the guide 'Correcting payroll errors - current year'.
If you need to correct payroll information for a previous tax year, what you need to do depends on whether the previous year's information was originally reported via forms P35 and P14, or on an FPS or EPS.
You can find out more about what you need to do to correct payroll information in previous tax years and when you might need to send an Earlier Year Update (EYU) and not an updated FPS in the guide 'Correcting payroll errors - previous year'.
The P60 summarises an employee's total pay and deductions for the year. You need to provide a form P60 (either paper or electronic) to each employee on the payroll who was working for you on the last day of the tax year (5 April). You must do this by no later than 31 May.
HMRC's Basic PAYE Tools - HMRC's software package will automatically prepare the P60s for you. You can either print copies of the P60s or you can complete paper versions of the forms.
Commercial payroll software - most payroll software should automatically prepare the P60s for you in either an electronic or printed format (contact your software provider for further details). Any printed version of an electronically provided P60 must clearly state 'This is a printed copy of an eP60'.
Electronic or paper versions - when deciding whether to provide forms P60 electronically or on paper you will need to take into account the employee's ability to easily access that information by providing secure facilities to view and/or print their P60. If this is not possible, the P60 can be issued to an email address that has been agreed with that employee. If you are unable to produce either electronic or printed forms P60 you will need to complete paper versions of the form. If you would like to use your own design P60s in either electronic or printed format, you must follow the HMRC guidelines provided in the RD1 booklet 'Specification for employer substitute forms P60' which can be downloaded using the link at the end of this section.
In all cases if:
Forms P9D and P11D relate to any benefits and expenses paid to an employee. Form P11D(b) is your return of the overall amount of Class 1A NICs due on the expenses and benefits you have provided as well as your declaration that you are reporting all relevant expenses and benefits on those forms.
These forms must reach HMRC no later than 6 July.
You must pay 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 due amounts not paid by these dates.
As explained earlier in this guide, there are a number of key tasks to complete in addition to submitting your final FPS or EPS for the tax year. The table below summarises this information for your convenience, including each appropriate deadline.
Give each relevant employee a form P60
Send expenses and benefits annual return - forms P11D, P9D and P11D(b) - to HMRC, and give a copy of the relevant P9D/P11D to each employee who was in your employment on 5 April
This is the last date for your forms P9D, P11D (or substitutes) and P11D(b) to reach HMRC
Class 1A NICs - postal payments must reach your HMRC Accounts Office
Class 1A NICs - cleared electronic payments must reach HMRC's bank account
The key task when preparing for the new tax year - which begins on 6 April - is to set up new payroll records for your employees. Most employers now have to send PAYE returns electronically using payroll software each time they pay their employees. So you need to use a payroll package to keep your payroll records - either commercial payroll software or HMRC's Basic PAYE Tools package if it's suitable for you. You can find out more about Basic PAYE Tools, which is designed for employers with nine or fewer employees, using the links below.
From 6 March 2014, you can file an FPS or an EPS to report PAYE information relating to payments for the tax year commencing 6 April 2014 (2014-15).