End Of Year Payroll Checklist
Payroll year-end is approaching, and it is essential to ensure all necessary processes are completed accurately and on time.
The HMRC deadline for your final payroll submission is 19 April. For your final Pay As You Earn (PAYE) payment, the deadline is 19 April if paying by post and 22 April if submitting a digital payment.
Ideally, year-end processing should involve a standard Month 12 or Week 52 payroll, with additional steps to close out the tax year properly. Understanding the key requirements is crucial to ensuring compliance and accuracy.
In this article outline the steps to prepare for payroll year-end efficiently.
Payroll Year-End Checklist 2025
1. Determine Your Payroll End Date:
Identify if your payroll concludes on week 52 or if an additional payroll is necessary, such as week 53, 54, or 56. This situation arises if you process payroll weekly, bi-weekly, or every four weeks, and your usual payroll date falls on 5 April (or 4 April in a leap year). Your payroll software will work out ‘week 53’ payments for you.
2. .Final Payroll Processing
Run the last payroll of the 2024/25 tax year.
Ensure all pay, bonuses, and deductions are accurate.
Submit the final Full Payment Submission (FPS) to HMRC on or before your employees’ last payday of the tax year.
If applicable, submit the final Employer Payment Summary (EPS) by 19 April 2025.
3. Employee Records & Compliance
Verify that all employee details (names, National Insurance numbers, addresses) are correct.
Ensure all new starters and leavers are recorded properly.
Update records for any changes in pay, benefits, or deductions.
4. Tax & HMRC Reporting
Review and pay any outstanding PAYE and National Insurance Contributions (NICs).
Reconcile payroll records with HMRC submissions.
Check for tax code changes for the new tax year (P9X form).
5. Employee Documents
Issue P60s to all employees by 31 May 2025.
Ensure employees' tax codes are updated for the 2025/26 tax year.
6. Payroll Software & System Updates
Update payroll software with new tax thresholds and rates.
Confirm compliance with any new payroll legislation.
Test the system to ensure correct calculations for the new tax year.
7. Company Financial & Benefits Review
Audit payroll expenses for the tax year.
Review employee benefits and salary structures for compliance.
Adjust pension contributions if needed.
8. Prepare for the New Payroll Year
Set up the first payroll for 2025/26.
Update payment schedules and reporting deadlines.
Ensure direct deposits and deductions are correctly carried forward.
By following this checklist, payroll can ensure a smooth transition into the new tax year while staying compliant with HMRC regulations.
