Correcting payroll mistakes
25/01/2024

Employers generally use payroll software or other payroll services to record employees pay, deductions and National Insurance contributions on or before each payday. They also need to consider other deductions such as pension contributions and student loan payments.

These payments are reported to HMRC in real time using a Full Payment Submission (FPS). This submission contains all relevant information for each employee.

If you have made a mistake with an employee’s pay or deductions this can usually be corrected by updating the year-to-date figures in your next regular FPS.

HMRC’s guidance also states that you can correct mistakes by submitting an additional FPS before your next regular FPS is due. You would need to:

  • update the ‘this pay period’ figures with the difference between what you originally reported and the correct figures;
  • correct the year-to-date figures;
  • insert the same payment date as the original FPS;
  • insert the same pay frequency as the original FPS; and
  • insert ‘H - Correction to earlier submission’ in the ‘Late reporting reason’ field.

If you need to correct an employee’s National Insurance deductions the action required will depend on whether the mistake occurred in this tax year or earlier tax years. There are also different actions that may be required to fix a mistake with an employee’s student loan repayments, again depending which tax year the mistake relates to.

If you have any payroll concerns, we would be happy to help.


About us  

We provide guidance, support, peace of mind, and assurance to ensure that you are successful in the aspirations you seek.
We are committed to keeping up to date with technical and legislative changes that affect our clients and ensuring we operate our business to meet the ever-changing needs of our clients.

 

Legal

Registered office: 2 Lambseth Street, Eye, Suffolk IP23 7AG

Company number 13781643

Contact us

Welland Orwell Limited
Office 7, 490 Larkshall Road
Highams Park
London
E4 9HH
 
JUMP TO TOP