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Setting up and closing Payroll schemes

Setting up a new payroll scheme to replace two schemes to be closed down

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Hi all.

In the midst of a January rush, I would be grateful for any guidance you could provide, please.

My new client has two payroll schemes (within one Limited company) which they were advised to do by a previous advisor.
They have two sections/departments in the one limited company, with one set of staff being weekly paid and the other being monthly paid.
They also use two different files in accounting software, one for each department and combining the whole thing at the year end and taking out intra-department transfers and transactions, so you can probably see why I would like to simplify the whole thing!

I know you can put in a request to HMRC to merge two payroll schemes, but I am a bit concerned that the changeover could take some time.

I wonder whether anyone thinks it would be possible/ok to set up a new payroll scheme to start on 6th April 2020, and close down the two old schemes on 5th April. It also fits in nicely with the company year end on 31st March.

OR, will I have no choice but to merge the schemes with HMRC?

Thank you in advance for any help and guidance you can provide, and good luck for the remainder of January!

Replies (3)

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RLI
By lionofludesch
17th Jan 2020 14:07

Dunno - why are you closing down both schemes ?

Why not close one and P45 the employees from that scheme to the other one ?

What are you trying to achieve ?

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By Cloudcounter
17th Jan 2020 14:10

Why not keep one scheme going and transfer the employees from the other into it at the end of the tax year?

Nothing new to set up, and you'll presumably close down the scheme with the fewer employees, so less work on the transfer as well.

That presumes that your software can handle weekly and monthly payrolls for the same employer. If it can't, I'd seriously consider changing it

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Replying to Cloudcounter:
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By enoryt010
17th Jan 2020 14:24

Thank you.
Yes, I think I will do that.

My software will do weekly and monthly pay in one payroll and the reason I can have only one scheme is that I can also allocate individual staff costs to varying departments so the business can monitor the performance of each department without having to use two accounting software files.

Thank you again.

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