In simple terms – annual PAYE process for most employers.
Step 1 – Send final FPS: this is a check box in the PAYE software which needs to be ticked confirming that it’s the final FPS of the year.
Step 2 – Issue P60: once step 1 has been completed, we need to issue P60 to all employees employed as at 6th April. Some software send P60s to all employees even those who left. So ensure to exclude the leavers when sending P60s. Also save a copy in your records.
Step 3 – Update Software: all PAYE software must be updated once the tax year ended. Usually the software will prompt you automatically to update it once you logging. Alternatively, visit software provider’s website for instructions.
Step 4 – Update tax code for the new year: please use HMRC guide P9X for this.
Step 5 – Update staff salary with National Minimum wage. Adjust director’s salaries where required.
1 – Before every payment run employers need to download tax notices from HMRC website. HMRC has made a very good free software – HMRC Desktop Viewer. Most software will have an inbuilt facility to download PAYE notices.