Getting ready for the new tax year, with BrightPay
The arrival of spring is always a sign that the tax year is about to end, and this means preparing your payroll bureau or accounting firm for the year-end and the start of a brand-new tax year. There are various tasks to plan for and complete, both before and after 6 April and the start of the new 2021/22 tax year, so getting organised will be essential.
We’ve highlighted the main tasks for the new tax year, with tips on how BrightPay makes the process simpler, easier and more connected.
Key tasks for the new tax year
The tax year will run from 6 April 2021 to 5 April 2022. If you want to be primed and ready for the new year, you need to get your planning hat on, highlight the key dates and start organising the workload for your portfolio of payroll clients.
The main tasks to focus on are as follows.
|What you need to do||When|
|Send your final pay report of 2020/21||On or before your employee’s payday|
|Update employee payroll records||From 6 April 2021|
|Update your payroll software||From 6 April 2021, or earlier|
|Give clients’ employees a P60||By 31 May 2021|
|Report employee's benefits and expenses||By 6 July 2021|
Let’s look at each of these elements in a little more detail, and see how BrightPay takes some of the hard work out of each task.
1. Complete your final 2020/21 payrolls
Your first task will be to run all your client’s payrolls for March 2021. You can speed this process up considerably by running batch operations to run multiple payrolls at once.
Once the payruns are completed, you can then send your final pay report for the 2020/21 tax year to HMRC. Sending a Full Payment Submission (FPS) to HMRC is a regular monthly task and shares the employer’s registrations details, employee details, pay information and year-to-date figures for each member of staff.
To submit a FPS in BrightPay to HMRC, first finalise your payslips within ‘Payroll’ for the pay period in question. An FPS will be automatically created within the RTI utility, ready for submission to HMRC. Being able to automate these key tasks is a huge time-saver and an important reason for aiming to get the best from your payroll software.
2. Update your clients’ employee records
Once the various payruns are completed, you can update the employee payroll records for each client. This ensures that each employee’s record is now fully up to date for the whole of the 2020/21 tax year, and that you’re working with the correct data when producing P60s and P11Ds in the coming months.
You can set up BrightPay to automatically back up all this payroll information to the cloud, using BrightPay Connect to upload your data to our cloud portal.
3. Update your BrightPay software for the 2021/22 tax year
Every tax year, BrightPay releases brand new software in line with the new budgetary requirements. To move your payroll on to a new tax year, simply download the new tax year version of BrightPay. Your software for the new tax year will contain a seamless import facility to bring across your employee details from the previous tax year.
You can order your 2021/22 version of BrightPay here, bringing you all the latest tax updates plus new BrightPay functionally.
4. Produce P60s for your clients’ employees
The P60 is a certificate of income that shows each employee’s income for the whole of the tax year that’s just ended. As such, it’s an important document for employees to access, giving them their total earnings, deductions, tax and National Insurance paid in the year.
It’s mandatory for employers to provide a P60 to each employee, but it’s a very simple and straightforward process to achieve in BrightPay. When sending P60s in BrightPay you pull down the information for each employee and then have the choice of either printing a hard copy P60, or sending an email copy to the employee. Employees can also log into BrightPay Connect to download their P60 directly from the employee portal, saving a lot of time and admin hassle.
5. Send out ‘benefits in kind’ information to HMRC
HMRC needs to know about any expenses claimed and ‘benefits in kind’ given to employees during the course of the preceding tax year. These benefits in kind (BIK) can have a significant impact on an employees tax code, so it’s important that all BIK are accounted for accurately in your payroll information.
You can quickly produce P11D end of year returns in BrightPay and send these straight to HMRC. Employees who require a P11D can pull this down from the BrightPay Connect employee portal.
P11Ds are not required where benefits have been payrolled throughout the year, however a P11D(b) declaration must still be submitted to HMRC at the end of the tax year. This declaration can be submitted using BrightPay.
Make the new tax year a breeze, with BrightPay
With BrightPay’s flexible payroll solution, you have all the benefits of efficiency, flexibility and automation built in to your software. Make the switch to BrightPay and make the start of the 2021/22 tax year a breeze for you, your clients and their employees.
Start a 60-day FREE trial of BrightPay and see the difference it makes to your payroll process.
Join BrightPay this Thursday (25 Feb 2021) for a free webinar to find out about the benefits associated with switching to BrightPay. Plus, discover some top tips for making the transition to BrightPay as seamless as possible. Extra dates added due to high demand.