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UK Payroll Glossary

Payroll year end

Payroll year end is the period each spring when UK employers close out one tax year and prepare to open the next. The UK tax year runs from 6 April to 5 April, so the year-end tasks cluster around April and May — and into July for benefits-in-kind. The key obligations are marking the final Full Payment Submission for the year, issuing P60s to every current employee by 31 May, updating tax codes and statutory rates for the new year, and filing P11Ds for any benefits-in-kind by 6 July. Missing any of these deadlines attracts HMRC penalties.

Last updated May 2026

The UK tax year

The UK income tax year runs from 6 April to 5 April the following year — a quirk of history tracing back to calendar reform in 1752. This is why:

  • P60s are issued in May rather than January.
  • Personal allowances and tax rate announcements say "from April 20XX" rather than the calendar-year convention used in most other countries.
  • PAYE cumulative calculations reset on 6 April each year — the year-to-date totals on a payslip in April 2027 start from zero again.
  • Auto-enrolment re-enrolment triennial cycles, SMP qualifying-week arithmetic, and SSP linked PIW chains all anchor to this 6 April start.

The year-end task list

Year end runs in three distinct bursts across April, May, and July:

April — before the first pay run of the new year:

  1. Run and submit the final FPS, marking it as the "Final submission" for the tax year. Most payroll software does this automatically if the final pay date falls in March. Missing this flag delays PAYE reconciliation and can trigger an HMRC prompt.
  2. Update tax codes. HMRC issues new tax codes for the next year (usually in February and March). Apply them before the first April payroll runs — failing to do so means employees overpay or underpay tax from day one.
  3. Refresh statutory rates. SMP, SSP, SPP, NI thresholds, the National Insurance Lower Earnings Limit, and the Primary Threshold all change each April. These constants live in your payroll software and should update automatically; always confirm the figures against gov.uk before running the first pay of the year.

By 31 May — issue P60s:

  1. Issue a [P60](/glossary/p60) to every employee who was on the payroll on 5 April. The P60 must be given on paper or as a PDF; most payroll software generates them automatically after the final FPS. Staff who left before 5 April do not get a P60 — they received a P45 when they left.

By 6 July — file P11Ds:

  1. Give each affected employee a copy of their [P11D](/glossary/p11d) and file all P11Ds with HMRC by 6 July. Pay Class 1A National Insurance on the total benefits by 22 July (electronic) or 19 July (cheque). Employers who have registered to payroll their benefits still need to submit the P11D(b) summary, even though individual P11Ds may not be required.

Common year-end mistakes

The same errors appear year after year among small UK employers:

  • Forgetting the "Final submission" flag on the last FPS. HMRC's system expects this marker; without it, HMRC may issue compliance letters asking whether the employer has ceased trading.
  • Missing the 31 May P60 deadline. Employees need P60s for mortgage applications and tax claims. Late issuance is technically a breach of the obligation and damages employee trust.
  • Not updating tax codes before the first April payroll. Running April pay with last year's codes means incorrect deductions from the very first pay run of the new year, requiring corrections later.
  • Not refreshing statutory rates in payroll software. If the software does not auto-update, running the first April payroll with old SSP or SMP rates results in incorrect pay and a manual correction process. Always cross-check the figures against gov.uk before processing.
  • Missing the P11D(b) when payrolling benefits. Employers who payroll all their benefits sometimes assume no year-end forms are needed — but the P11D(b) (for Class 1A NIC) is still required even when no individual P11Ds are filed.
In Ghugi terms: The most visible year-end step for employees is receiving their P60 — and Ghugi delivers P60 PDFs to every employee in exactly the same batch flow used for monthly payslips. Upload the year-end P60 PDFs from your payroll software, Ghugi matches each one to the right person, and they land in inboxes on time.

Related terms

P60A P60 is the end-of-tax-year summary an employer must give every employee who was still employed on 5 April.P11DA P11D is the annual form an employer files for each employee who received taxable benefits-in-kind that weren't taxed through…PAYEPAYE is HMRC's system for collecting Income Tax and National Insurance directly from employees' wages before the money reaches…PayslipA payslip is the document showing what an employee was paid for a specific period — usually a week or a month.

Authoritative source

gov.uk: payroll annual reporting →

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Disclaimer: This glossary is for general guidance. Specific UK tax thresholds and statutory rates are checked at publication and re-reviewed every April; always verify against the official gov.uk pages for the current tax year. Ghugi is not a payroll provider and does not give tax or legal advice. For your situation, ask your accountant or HMRC directly.