Process the Year End 2010-11

Before Running the Year End

1. Back Up

It is important that you secure a backup for each payroll template before you start the year end process.

2. Run the Period End and Year End

When you select the Payroll > Functions > Period End Process and you are in the final period of the year, you will see the message “A YEAR END will also be performed”. After you click Run and confirm you want to continue, all the year end processing is automatically carried out.

After Running the Year End

Steps 1 – 4 should be taken before you process any payroll for the new tax year.

1. Check your software version number

You can find the software version number in the title bar of the Application Login window. It must be version 2.1.4 or later.

If you are running an earlier version of Jane HR, you must upgrade your software. Click here for details.

2. Period End Dates

You 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 because these describe the start and end of the new tax year.

3. General Ledger Integration Periods

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

4. Changes to Statutory Values for the 2011-2012 Tax Year

There are some changes to legislation for the new tax year. Therefore, you must adjust the parameters to reflect the new rates and values. You can either change the fields by entering the new values, as described below, or you can import the parameters.

4.1 SMP Parameters   

a) Qualifying average weekly earnings on which SMP can be paid rises to £102.00 a week if the baby is due on or after 18th July 2011.

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 £128.73.

4.2 SPP Parameters

a) Qualifying average weekly pay should be set to £102.00

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 £128.73.

4.3 SAP Parameters

a) Qualifying average weekly pay should be changed to £102.00

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 £128.73.

4.4 ASPP Parameters

The following should be set up for the new Additional Statutory Paternity Pay.

a) Qualifying average weekly pay should be set to £102.00

b) Total number of weeks should be set to 19.

c) No of weeks on higher rate should be set to zero. 

d) Upper rate percentage should be set to 90%

e) Statutory weekly value should be set to £128.73.

You must enter all these changes on the Child Care tab (click Payroll > Module Setup > Module Definitions > Child Care).

4.5 SSP

The SSP prevailing rate has been changed to £81.60. Click Payroll > Module Setup > Module Definitions > Sickness to find this parameter.

There are two new fields in this window:

  • Minimum Days, which is the minimum number of days that constitutes a period of incapacity to work and should be set to 3.
  • Exclude if SMP within X Weeks, which prevents SSP being paid if the employee is on maternity, and should be set to 39.

4.6 National Insurance

From 6th April 2011 the NI rates and bandwidths for the 2011/12 tax year as stated by HMRC are:

Earnings Limit

Weekly

4 Weekly

Monthly

Annual

Lower Earnings Limit (LEL)

102.00

408.00

442.00

5304.00

Secondary Threshold (ST)

136.00

544.00

589.00

7072.00

Primary Threshold (PT)

139.00

556.00

602.00

7225.00

Upper Accrual Point (UAP)

770.00

3080.00

3337.00

40040.00

Upper Earnings Limit (UEL)

817.00

3268.00

3540.00

42475.00

Employee Rates

A

D/F

B/E/G

C

J

L/S

Below LEL

0.0

0.0

0.0

0.0

0.0

0.0

LEL-ST

0.0

1.6

0.0

0.0

0.0

1.6

ST-PT

0.0

1.6

0.0

0.0

0.0

1.6

PT-UAP

12.0

10.4

5.85

0.0

2.0

2.0

UAP-UEL

12.0

12.0

5.85

0.0

2.0

2.0

UEL+  

2.0

2.0

2.0

0.0

2.0

2.0

Employer Rates

A/B/C/J

D/E

F/G

L

S

Below LEL

0.0

0.0

0.0

0.0

0.0

LEL-ST

0.0

3.7

1.4

3.7

1.4

ST-PT 

13.8

10.1

12.4

10.1

12.4

PT-UAP

13.8

10.1

12.4

10.1

12.4

UAP-UEL

13.8

13.8

13.8

13.8

13.

You maintain these values on the NI Table tab (click Payroll > Module Setup > Module Definitions > NI Table).

The NI Thresholds for directors should be also changed to reflect the new values.

The NI thresholds should also be altered on each payroll template used.

Click Payroll > Module Setup > Templates > Tax — see example window below.

4.7 Tax

From 6th April 2011 the PAYE rates and bandwidths for the 2011/12 tax year as stated by HMRC are:

Thresholds

The PAYE thresholds (the level of earnings at which tax becomes payable) are: £144.00 weekly and £623.00 monthly.

Rates

The tax rates are: Basic rate 20% from £1 to £35,000 Higher rate 40% from £35,001 to £150,000 Additional rate 50% from £150,001 and above.

Band                Width                             %

1                      35,000.00                    20.00

2                      115,000.00                  40.00

3                      9,999,999.99               50.00

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

You maintain tax bandwidths on the Tax tab (click Payroll > Module Setup > Template > Tax).

This example shows a monthly payroll.

4.8 Tax Code Changes

The Emergency tax Code for 2011/12 is 747L

You can alter employees’ tax codes by using Payroll > Functions > Global Tax Code Update. From 6th April 2011, L suffix codes will increase by 100, so all employees currently on tax code 647L will change to 747L (unless you have been sent a P9 for the employee).

4.9 Week/Month 1 flag

You should run Payroll > Functions > Reset Week/Month 1 Flag to reset the week/month 1 flag for all employees. D0 and NT tax codes carried forward should be operated on a cumulative basis, so you will need to clear their week 1/month 1 flag.

4.10 Student Loans

The threshold at which student loan repayments are to be made from April 6th 2011 is to stay unchanged at £15,000. To find this parameter, click Payroll > Module Setup > Module Definitions > References.

4.11 Small Employers Relief

For employers who qualify, NI compensation for small employers’ relief changes from 4.5% to 3%. This is on the Tax tab (Payroll > Module Setup > Template > Tax). In the Rebates section of the window, for those who qualify for small employers’ relief, type 103 in the SMP, SPP, SAP, and ASPP fields. Otherwise, these fields should be set to 92.

5. P60s

You must give every employee who is working for you on 5th April 2011 a P60 by the 31st May 2011. You do not need to give them to employees who have left before the 5th April 2011.

Refer to Year End Reports for more details. If you do not have the latest report formats, you can download them from our website. Click here to download.

6. P14/P35 Internet Return

HMRC must receive your P14/P35 internet return by 19th May 2011.

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

Refer to P14/P35 Internet Return 2010-11 for full details.