Preparing for payroll year end with BrightPay

It’s almost time to process your final payroll of the 2022/23 tax year. Payroll year-end can be a stressful time for payroll processors, but with the help of Bright’s payroll solution, BrightPay, it doesn’t have to be complicated. Here are five steps to cover when processing year-end.

1. Do you have an extra pay run?

If any of your employees’ pay days falls on Wednesday the 5th of April this year, it could mean an extra pay run for the tax year. This applies to employees who are paid weekly, bi-weekly or every four weeks. This means, rather than there being 52 payrolls in the tax year, you will have a payroll week 53 for weekly paid employees, a payroll week 54 for those paid bi-weekly, and a payroll week 56 for those paid every 4 weeks. For employees who are paid monthly, you have nothing to worry about. Payroll that’s processed on a monthly basis, can only run for 12 months of the year.

If a pay date falls on the 5th of April, then your payroll will look like the following:

• Weekly payroll falling on the 5th April – A week 53 payroll (5th – 11th April)

• Bi-weekly payroll falling on the 5th April – A week 54 payroll (5th – 18th April

• Four-weekly payroll falling on the 5th April – A week 56 payroll (5th April – 2nd May)

When processing a week 53, 54 or 56, payroll software BrightPay will automatically apply a week 1 tax code.

2. Has there been any leavers or starters in your business?

Employees come and go for many reasons, but if this has been the case for your business within the last year, now is the time to double check that they have been processed. With so many responsibilities, it’s easy to forget to take an employee off the company payroll. But if you did, don’t worry, you can process your leavers and starters before year-end. It can be tricky to revert and fix these details after you’ve completed year-end.

3. Running your final payroll of the tax year

The next step will be to process your final payroll of the tax year. Nothing has to be done differently here, you just process the payroll as you normally would and finalise all payments made to employees before and up to the of 5th April 2023. You then need to submit your final FPS and your final EPS, if required. These must be submitted to HMRC by the 19th of April.

4. Prepare your P60s

When processing your payroll year-end, all employees who are actively employed by you on the last day of the tax year (5th of April 2023), must receive a P60. A P60 is an employee’s certificate of income for the previous tax year. In a nutshell, it’s a summary of your employees’ payslips which you are legally required to send to employees every 12 months. If you use BrightPay, within the software you can print or email P60s to employees individually or you can send them to multiple employees at the same time. P60s must be sent to employees by the 31st May, 2023.

5. Begin the 2023/24 payroll year

Before you begin to process your first payroll of the new tax year, remember to check employees’ tax codes and if any of them need to be changed. HMRC will issue employers a document called a P9(T). The document will let you know which tax codes should be changed and which should be carried forward. BrightPay makes updating tax codes quick and easy. From within the software, you can retrieve and process employee PAYE coding notices directly from HMRC. Once you have checked for coding notices, you can apply any new tax codes instantly.

With the right payroll software, processing year-end can be a walk in the park. If you would like to learn how to process payroll more efficiently for the next tax year, book a free 15-minute demo of BrightPay.

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This content may have been developed with the assistance of AI tools. Content is reviewed by a member of the Bright team before publication. Guidance on legislation can be obtained from your industry body.