FOROES

What To Do When You Want To Change Your Paydays

There is no rule saying that you must pay your employees on the same day for the rest of their working lives with you. You may have reason to move your payday, or you may need to change the frequency with which you pay employees. You may be changing from a weekly to a monthly pay schedule for employees who have been with you for a longer length of time, or you may want to adjust the payday so that it falls at a more convenient time for your finance department. If you want to change paydays in any way, take a look at what you need to do to remain compliant.

Changing the Day of Payday

If you have decided to change the date of payday and when the new payday falls within the same tax week or tax month, you simply need to consider the new payday as an extra payment within that month or week. If the new payday is in another tax week or tax month you do not need to do anything special for payday but stick to the same procedure of making your submission to HMRC on the day or before you make the payment.

Changing the Frequency of Payday

If you are going to be paying your employees less often you need to contact HMRC so that you do not get sent notices when you fail to file on the days when you would originally make payments. Look at what you need to pay for National Insurance so that you don’t end up deducting more National Insurance than you should. Specialist payroll companies will be able to advise you on what you need to do for National Insurance in these cases.

If you will pay your employees more often you can change the pay frequency in the new earnings period if you have not already paid your staff. If you have already paid your staff you can update the payment frequency in the next tax month.

Paying Employees Annually

When you pay staff members only once a year, and when they are all paid within the same month for tax purposes, you can use the HMRC annual scheme. So when you pay once a year, you report once a year to HMRC. You also need to send an EPS for the months when you do not make any payments to employees. If you are changing the month when you pay your employees annually, send an EPS in the month you normally pay and an FPS in the month you are now paying.

Exit mobile version