Process the Payroll Year End 2009-2010

Before Running the Year End Process

Please check that the following tasks have been completed before running the Year End Process.

1. Week 53

If you run a weekly payroll with 53 pay periods then payments are only recorded on the Payroll balances when the period end is completed for the 53rd period. Any reports/exports invoked prior to this point would obviously exclude any such payments.

2. Back Up

It is important that at least one back up is secured for each payroll template prior to invoking the year end process.

3. Run the Period End / Year End

When you select the Payroll / Functions / Period End, if you are in the final period of the year you will see the message “A Year End will also be performed”. On selecting “Run” and confirmation that you do wish to continue, all the year end processing will be carried out.

After Running the Year End Process

Once the Year End process is completed you need to check and update the following areas.

1. Period End Dates

When the new tax year is opened you will need to ensure that the Period End dates on the Payroll Templates have been suitably rolled over for the new tax year (Payroll / Module Setup / Templates). Particular consideration should be given to the period end dates of the last period of the old and new tax year as these describe the start and end of the new tax year.

2. General Ledger Integration Periods

You also need to check that the General Ledger integration periods correctly cross-reference as these ensure the payroll periods integrate to the required financial periods.

3. Changes to Statutory Values for the 2010-2011 Tax year

There are some changes to legislation for the new tax year therefore you will need to adjust the parameters to reflect the new rates and values. You can either adjust the fields manually as described below or import the parameters see “How do I Import Payroll Parameters” for more details.

3.1 SMP Parameters   

a) Qualifying average weekly earnings on which SMP can be paid rises to £97 a week if the baby is due on or after 18th July 2010.

b) Total number of weeks should remain at 39.

c) No of weeks on higher rate should remain at 6.

d) Upper rate percentage should remain at 90%

e) Statutory weekly value should be changed to £124.88.

3.2 SPP Parameters

a) Qualifying average weekly pay should be set to £97.00

b) Total number of weeks should remain at 2.

c) No of weeks on higher rate should remain at zero.

d) Upper rate percentage should remain at 90%

e) Statutory weekly value should be changed to £124.88.

3.3 SAP Parameters

a) Qualifying average weekly pay should be changed to £97.00

b) Total number of weeks should remain at 39

c) No of weeks on higher rate should remain at zero. 

d) Upper rate percentage should remain at 90%

e) Statutory weekly value should be changed to £124.88.

These changes need to be entered into the Payroll / Module Setup / Module Defintions screen on the Child Care tab.

3.4 SSP Prevailing Rate

Note that the SSP Prevailing rate has not altered therefore this should be left at £79.15. This can be found on the “Sickness” tab on the Payroll / Module Setup / Module Definitions screen.

3.5 National Insurance

From 6th April 2010 the NI rates and bandwidths for the 2010/11 tax year as stated by HMRC are:

Earnings Limit

Weekly

Monthly

Annual

Lower Earnings Limit (LEL)

97.00

421.00

5044.00

Employee and Employer Threshold (ET)

110.00

476.00

5715.00

Upper Accrual Point (UAP)

770.00

3337.00

40040.00

Upper Earnings Limit (UEL)

844.00

3656.00

43875.00

Therefore you will need to alter parameters on the following screen.

Payroll / Module Setup / Module Definitions – NI Table tab

The Lower Earnings Limit for directors should be changed from £4940.00 to £5044.00. The other limits and thresholds remain the same.

The lower earnings limit should also be altered on each payroll template used.

3.6 Tax

From 6th April 2010 the PAYE rates and bandwidths for the 2010/11 tax year as stated by HMRC are:

Band                Limit                             %

1                      37400.00                     20.00

2                      112,600.00                  40.00

3                      9999999.99                 50.00

You will need to enter the new bandwidths against all payroll templates used.

Tax bandwidths are maintained on the Payroll / Module Setup / Templates screen – Tax tab.

3.7 Tax Code Changes

There are no global Tax Code updates for the year 2010/2011 so this process will not be required.

 3.8 Week/Month 1 flag

The ‘Reset week/Month 1 flag option’ found on the Payroll functions menu should be run to reset the week/month 1 flag for all employees. From 6th April 2010, D0 and NT tax codes carried forward should be operated on a cumulative basis. If any employees have either of these tax codes you should clear their week 1 / month 1 flag.

3.9 Student Loans

The threshold at which Student Loan repayments are to be made from April 6th 2010 is to stay unchanged at £15,000. This can be found on the Payroll / Module Setup / Module Defintions – References tab.

4. P60s

You need to give every employee who is working for you on 5th April 2010 a P60 by the 31st May 2010. You do not need to give them to employees who have left before the 5th April 2010.

See Year End Reports for more details.

Note that the format of the printed P60 has changed this year to include the values up to and above the Upper Accrual point. If you do not have the latest report formats then they can be downloaded from our website.

5. Process P14/P35 Internet Return

Before running this option you need to ensure that the tax district, tax reference and company details are recorded on the system parameters (Payroll / Module Setup / Module Definitions) and that the tax reference is in the correct format i.e. 123/1234567, so that it includes the Tax District Number.

See “How do I Process P14/P35 Internet Returns” for full details.