Since 2019, there has been a permanent easement for reporting PAYE information in real time. This is where employees receive their pay earlier than usual at Christmas.
Reporting the Contractual Pay Date
Where an employer closes on the usual (contractual) payday, such as at Christmas or on bank holidays, HMRC advises to report the contractual pay day on the full payment submission (FPS).
An example provided for Christmas by HMRC is “if you pay on Friday 20 December 2024 but the normal (or contractual) payment date is Friday 27 December 2024, please report the payment date on the FPS as 31 December and ensure the submission is sent on or before 31 December 2024.”
PAYE Reporting Obligations
The normal PAYE reporting obligation for employers is unaffected by this easement and you must still report payments on or before the date employees are paid, outside of the Christmas period. The pay date recorded on the FPS, however, should always be the contractual pay date.
Impact on Universal Credit Eligibility
Doing this will help protect any employees’ universal credit eligibility, avoiding double monthly earnings in one assessment period. Where two payments are received in one assessment period, universal credit can be reduced, as it is a means-tested benefit.
Where individuals are paid on a weekly, fortnightly, or four-weekly basis there will always be occasions where more than one payment is made within an assessment period. In these instances, amending the reporting will only move the issue into a different period.
Further Information
If you have your payroll already set up with NRB, do not worry, we have this covered for you. However, if you are interested in looking at NRB’s payroll service offering please email payroll@nrb.co.uk
Click here to find out more about our Payroll Services.
