How to prepare for the end of year payroll

28 September 2022

The December payroll is still a few months away, but it is essential that payroll teams begin to start thinking about it now. Whilst Payroll is a business as usual activity, it can demand special attention during the festive season. Early planning can ensure a streamlined and successful December pay run: 

Review dates Pay dates commonly fall toward the end of the month, where they may clash with bank holidays. In that case, the business may decide to pay staff slightly early. It’s important to review this with the wider business early, so that a decision can be made and any change to the pay date can be communicated to employees. 

Double-check resources Because of the bank holidays, the end of December is an extremely popular time for people to book leave. It is best to plan ahead, making sure that those individuals involved in payroll processing are available at key times in the month. This includes people such as finance managers or those with authority for payment sign offs. 

Work with your payroll team Whether payroll is run in-house or with an outsourced provider, most businesses will use a payroll processing schedule that outlines the key deadlines and steps to be taken each month. Once the year’s final pay date is set and the availability of key people is confirmed, it is important to review other deadlines and communicate them. Adjustments may be needed to ensure the new deadlines will be met. 

End-of-year bonuses Will there be any additional payments, such as a bonus scheme? Start gathering information from the business now so that payroll can make sure extra payments go through on time. Business hours are fewer in December than in a usual month, so advance planning is key.

RTI reporting If you decide to bring forward your December payment date, do not report the change on your December RTI submission. The submission still needs to be filed with HMRC on or before your normal payment date. It will affect staff who receive Universal Credit or state benefits if you change the payment date in your payment system. 

Payslips Even if the December payment date changes payslips should still detail normal payment dates, rather than the date staff are actually paid.

PAYE Don’t forget to pay your PAYE liabilities. These will be due on or before 22 December 2022 if you pay electronically (19 December 2022 if paying by other means).

The main overall aim is to plan and be organised well in advance so the process can remain well-structured and streamlined. It will reduce the impact that the holidays can have on a business.

For more information on how RSM can help you streamline your payroll process, please contact Simon Balaam