May 2017
30
Using BrightPay to Create Earlier Year Updates
A Full Payment Submission (FPS) informs HMRC of payments to employees and includes deductions that have been made. This should be sent to HMRC from your payroll software on or before each payday. The end of year deadline to send an FPS submission is the 19th April. If any amendments need to be made to an employee’s totals after this date then you are required to submit this information in the form of an Earlier Year Update (EYU).
EYUs are used to correct information submitted in the previous tax year. An EYU simply reports the adjustment made to an employee’s totals in the payroll, as opposed to reporting re-stated year to date totals for the tax year to HMRC. EYUs for each tax year can be prepared multiple times as required, without limit, and will be accepted by HMRC for a period of 6 years.
Unfortunately for employers, not all payroll software packages have the ability to create EYU files and therefore cannot easily make corrections where needed after the tax year. In addition to using their existing payroll software, many employers double their workload and use HMRC Basic PAYE Tools to create and submit an EYU. HMRC have advised that employers should only use Basic PAYE Tools to complete and submit an EYU if their payroll software does not have this facility.
It is important to note that good payroll software packages can seamlessly create an EYU and facilitate the submission to HMRC. Compared with using two separate payroll systems, it is advisable to look for payroll software that can do this for you, for example BrightPay.
With BrightPay, if a mistake is made in the payroll the user can seamlessly roll back the payroll for employees on an individual basis. Once the correction has been made and the payslip has been finalised, BrightPay will enable users to create the EYU at the click of a button. Simply select the employees for whom you have made an adjustment and submit the EYU to HMRC.
Along with easy to use RTI functionality, BrightPay also allows users to automate their auto enrolment duties and has both CIS and P11D features. Book a demo today to see just how easy it is to use BrightPay.
Read more at www.brightpay.co.uk >
