HMRC trials payroll changes to earlier year updates

In a bid to improve payroll reporting, HMRC is running a trial aimed at simplifying the process for reporting corrections by extending the use of the real time information (RTI) full payment submission (FPS).

Employers can continue to report revised year to date payroll data after the current deadline of 19 April, following the end of the tax year, making sure HMRC systems with employer payroll records are aligned. Some payroll software already supports this.

A year to date FPS can be used to correct payroll errors for the 2018-19 tax year which are identified after 19 April 2019.

If existing payroll software does not support the change as yet, agents and payroll managers should continue to make corrections using the earlier year update (EYU) process.

If the trial is successful, HMRC expects all payroll software providers will have software in place by April 2020. This will mean that the EYU will no longer be a valid submission type for tax years 2019-20 and later years.

All amendments to payroll data for the year 2019-20 and future years identified after the year-end will need to be made on an FPS.

HMRC’s Basic PAYE Tools software will be amended in April 2020 to support the change to an FPS.

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