Payroll: what to do as the end of the tax year approaches

HMRC have recently released their annual guidance document, P9X, setting out the payroll tasks that employers need to do to get ready for the new tax year.

One task will be identifying the correct tax code to use in the new tax year for each employee who will be working for you on 6 April.

As most tax codes are based on the personal allowance, they can, with a small adjustment to take account any raises in the personal allowance, be carried forward into the new tax year. P9X explains how to uprate these general tax codes for employees ready for the 2017/18 tax year. This should be done after the last pay run of this tax year -which ends on 5 April 2017 – to ensure a smooth transition into the new tax year.

The guidance also provides details of the tax rate bands and emergency tax codes for the 2017/18 tax year.

The document itself is available in full on GOV.UK.

Sometimes an employee has an individual tax code that can’t be dealt with by uprating. HMRC will tell you what the new tax code is on form P9 Notice of Coding.

Email notifications will be sent from 18 February to 5 March advising that the P9 notices of coding for the tax year starting 5 April 2017 can be viewed online. When logging into the online account to view the P9 notices, please ensure the correct tax year is selected, 2017-2018.

If you usually receive paper P9 coding notices, HMRC have also started to send out these this month and expect to end on or around 17 March 2017, however you may still receive notifications as late as 20 March.

If you do not receive your paper P9 notices in time for the first pay period after 6 April 2017, or you have any other payroll problems you should call the Employer Helpline:

New and inexperienced employers: 0300 200 3211
Experienced employers: 0300 200 3200
Employers with hearing difficulties: textphone 0300 200 3212