Payroll year-end can be a busy time for businesses as they navigate deadlines, submission dates, and HMRC rules. Without enough planning, year-end has the potential to be highly stressful. Learn the essentials of payroll end-of-year submission, including common challenges and ways to tackle them.

What is HMRC payroll year end?

Payroll year-end sees a business wrap up the tax year for payroll purposes. Every twelve months, following your final pay run, you’ll need to send specific information to HMRC: a Full Payment Submission (FPS) and possibly an Employer Payment Summary (EPS). You’ll also need to issue P60s to your employees and make any adjustments to tax codes for the new tax year.

Think of it as drawing a line under your payroll for that period. You’re telling the government the total amount you’ve paid your employees as well as the deductions you’ve made, and taking care of necessary admin before you can embark on a new tax year. 

This is in contrast to your usual payroll which happens every payday – usually weekly or monthly – rather than just at the end of the tax year. 

If you’re new to payroll, read about what is it and how it works.

Tackle common year-end payroll challenges

Manage large quantities of complex data

When a business grows, the amount of employee information also grows. It can be difficult to keep accurate records when employees earn fluctuating amounts of money, receive different benefits, or come and go throughout the year. 

That’s where Xero accounting and payroll software helps. It accurately stores information in one place and does the complicated calculations for you. 

Avoid lack of communication

In a busy workplace, it can be hard to keep each other updated on employees. Somebody might have been paid a bonus or had a change in status, such as becoming eligible for more childcare vouchers. 

Put in processes where the person or team in charge of payroll is told about anything relevant. This might mean regular meetings or using HR checklists.

Keep up to date with changes in legislation

It’s crucial to stay in the loop with changes to HMRC’s rules and deadlines. 

The gov.uk website is your best first stop for such information. 

Be aware of hard deadlines

Not only does a business need to do its final payroll, it must also perform the other year-end tasks, all to set deadlines. 

Having the right software can keep this on track. When more work is automated – and all done in a single place – you’re freed up to focus on other tasks.

For payroll year-end 2024/25, key dates are the following:

• 5 April 2025: 2024/25 tax year-end 
• 5 April: The last day to update your employee payroll records and your payroll software
• 6 April: The new tax year for 2025/26 begins
• 19 April: The deadline for the final submission of the 2024/25 tax year
• 22 April: The deadline for month 12 PAYE
• 31 May: The deadline to send your employees their P60s
• 6 July: The deadline to report on expenses and benefits (using your payroll software if applicable)
• 6 July: The deadline to submit your P11D and P11D(b) forms
• 22 July: The deadline for payments of class 1A National Insurance contributions on benefits in kind to HMRC. (If you’re not using digital systems, the deadline is 19 July)

Use a checklist to stay on track

With multiple deadlines and tasks to manage, a year-end checklist is essential for staying organised. Look out for our soon-to-be released step-by-step guide, which breaks down each task and its timeline to help keep you on track.

Embrace payroll software for year-end tasks

Xero cloud-based accounting software can streamline your payroll and make year-end reporting easier to tackle.

HMRC-recognised, Xero simplifies your compliance with automated RTI submissions and easy adjustments. Payroll calculations are also automated, so your records stay correct and up-to-date. Likewise, pension re-enrolment is a speedy process, meaning it’s easier to meet your obligations.

So then, when it comes to year-end, you’ll be in good shape to hit the deadlines. All the relevant reports and information will be waiting in one, secure place – ready for team members to work alone or collaboratively, from wherever they are in the world. That means less stress and more confidence that you’ve nailed the payroll process. 

Get more info about payroll in Xero here. 

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