New tax year on 6th April: update your employee payroll records

The start of the new tax year on April 6th is a critical date for UK business owners and payroll departments. This milestone requires an immediate update of employee payroll records to ensure compliance with current regulations. 

With the deadline approaching, it’s essential to verify that all administrative tasks are completed to avoid errors in tax calculations or reporting.

The primary responsibility for an employer at this stage is to ensure that every staff member has an established payroll record with a correctly assigned tax code. This requirement is not limited to full-time or high-earning staff. 

You must maintain a payroll record for every employee, regardless of the amount they have earned during the current tax year. This obligation also extends to former staff members; if an individual worked for your business at any point during the current tax cycle, they must be included in your payroll records, even if their employment has since ended.

The accuracy of these tax codes is vital because they directly dictate how much tax is deducted from an employee's gross pay. Incorrect codes can lead to staff members receiving less take-home pay than they are entitled to, or alternatively, paying too little tax and facing future demands from HMRC. 

To enable these updates, HMRC issues P9T forms for any existing employees who require a tax code change. For new employees joining the company, the P45 provided by their previous employer remains the standard source of information for setting up their initial payroll record within your system.

Once payroll records are properly established, employees can begin submitting claims for business-related expenses. While many businesses still rely on traditional manual methods for processing these claims, these processes are often time-consuming and prone to human error. 

Moving toward a digital expense management platform is a practical alternative for businesses looking to reduce the administrative burden associated with manual data entry and receipt tracking.

Expend provides a platform designed to address these specific logistical challenges. The system includes a mobile app that allows employees to log their expenses at the moment they occur. By using a smartphone to upload digital copies of receipts and invoices, staff can submit financial data securely and instantly. This replaces the need for physical paperwork and ensures that records are captured before they are lost or damaged.

From a management perspective, digital systems offer an integrated approval workflow. Expenses can be reviewed and sanctioned with a single action, which simplifies the oversight of company spending. One of the most significant benefits for an accounts department is the use of automated reminders. These notifications ensure that employees provide the necessary documentation for every claim, which is a requirement for maintaining accurate records for HMRC.

Finally, the ability to integrate expense data directly into an existing accounting system offers a high level of operational efficiency. It allows management to monitor company expenditures as they happen, rather than waiting for end-of-month reconciliations. This real-time visibility is far more effective than manual systems, which often leave departments playing catch-up with old data. 

As a business grows, a centralised and scalable system like Expend becomes increasingly useful for governing financial processes from a single point of control. Contact Expend today to learn more and book a demo.  

Want to read more? Our online blogs cover all aspects of expense management. 

Disclaimer: This is not legal, accounting, or tax advice - it's simply a guide. If you need help, check with your accountant or contact HMRC directly.