Xero Payroll Year End Guide

As Edinburgh Accountants, it only seems like yesterday when we were working all the hours to finalise self assessments.  Since the end of January we experience some respite, before we then have to tackle the closing off of 17/18’s payroll, and open up 18/19’s new payroll.

If you have the joys of running a payroll, the following seven steps should help you successfully navigate the steps required to successfully close one payroll year and set up the next.

1. Review your opening balances

If you took on the payroll partly through the year, you should have entered opening balances into your payroll system.

Prior to closing off, check to ensure that not only the organisational balances are entered correctly, but also if you have an employee starting during the year, ensure that their opening balances are also entered into your Xero payroll system correctly.

2. Carry out a year end reconciliation

Although it is recommended to reconcile payroll throughout the year it is also good practice to reconcile payroll at the year end.  You are looking for any rogue transactions hitting the payroll general ledger accounts

In Xero we use three reports

  1. Gross to Net Report
  2. P32 Report
  3. Account transaction report

3. Process your final pay Run

There is no difference in running a final pay run, to a normal monthly pay run, just ensure that any year to date figures on payslips match up with what you would expect.

Remember to submit your final Submission to HMRC by 19th April

4. Download your employees P60’s and P11’s

As an employer, you have to provide your employees with P60’s and P11’s by May 31.

5. Set up your 18/19 Payroll

Review and amend all of your ongoing employees tax codes.  One thing to watch out for, is if someone was on a W1M1 code this should be amended to Cumalative.  Also Review the employees NI categories to ensure these are still accurate.

6. Review National Insurance Employment allowance, and Directors settings

If you have employees you should already be claiming the NI Employment Allowance.

7. Review New Pension Contributions

If you are running pension, then remember that the minimum contributions will increase from April 1st. 2% for the Employer, 3% for the Employee

 Any questions we are only a phone call away.

Crunchers – Accountants Edinburgh

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