Tax Year 2025/26

When you have finished processing all of your pay runs for the year, you need to notify HMRC. This is done within the RTI files by sending a 'final submission indicator'. When this is submitted, HMRC will not expect any further submissions for that tax year and will effectively close the payroll for that year.

The platform will automatically populate the final pay run indicator if it is the last period of the tax year, e.g month 12 (this can be unticked if required). If for any reason you miss sending this in the full payment summary (FPS) for your final pay run you can manually set this flag within the employment payment summary (EPS) to notify HMRC instead.

Note: If you are processing multiple payment frequencies under the same PAYE reference, flag the final pay run in the last FPS you send. The deadline for the final submission to be filed with HMRC is the 19th April 2026.

When you have processed and finalised the last pay run for the tax year, you can then issue P60s to employees. This is only required for employees in employment on the 5th April. Employees that have left before this date will have received a P45 instead. Guidance for P60s can be found here.

Note: If the pay run is automated, and the option to send employee notifications has been selected, then P60s will be published automatically. Further guidance on pay run automation can be found here.

The deadline for P60s to be issued to employees is 31st May 2026. An action item will be created in the dashboard to remind you of this.

Any benefits you have payrolled or reported via P11D for 2025/26, if they are required for 2026/27, these need to be rolled into the new tax year. Within the benefits section of the business, there is a year-end option that will take you through the whole process. More information about payrolling benefits can be found here. P11D information can be found here.

Updates applicable for the new tax year. These will be applied automatically unless stated otherwise.

• Tax code uplifts - There are no uplifts for 26/27 tax year, standard/emergency tax code remains at 1257L. Week 1/month 1 status will be cleared down when you create your first pay run in the new tax year, please allow extra time for this process.
• Tax thresholds - No change to England/Northern Ireland and Wales, percentage thresholds remain the same. Scotland does have changes to the thresholds which will be applied.
• National Insurance - the lower earnings limit has increased to £6708
• National Minimum Wage/National Living Wage will increase from April 1st, with the 21+ rate increasing to £12.71 with weekly accommodation to £77.70.
• Statutory Sick Pay increased to £123.25 or 80% of average weekly earnings, whichever is lower. The removal of waiting days so SSP is now payable from the first day of sickness and the lower earnings limit removed, making all employees eligible.
• Statutory Parental Pay increased to £194.32.
• Changes to Statutory Parental Bereavement Pay for employees working in Northern Ireland- leave becomes a day one right and will include miscarriages before 24 weeks. An NI workplace postcode will be required upon entry of the leave.
• The NIC compensation rate has been increased from 108.5% to 109% from 6th April.
• Student loan plan 1 earning threshold increased to £26,900, plan 2 to £29,385 and postgraduate loans to remain the same at £21,000. Scottish student loan plan 4 earning threshold increased to £33,795.
• A new student loan plan 5 begins with a threshold of £25,000.
• Automatic enrolment - Earnings trigger remains at £10,000. The Lower Earnings Limit will not be uplifted to the increased £6708 for purposes of Auto Enrolment.
• Employment Allowance – The removal of the Di Minimis State Aid selection and reporting of.
• Flat rate van benefit charge increases to £4,170.
• Flat rate van fuel benefit charge increases to £798.
• Car fuel benefit multiplier increases to £29,200.
• CO2 rates for company cars have increased for the 2025/26 tax year.

• If you have a director set up in the payroll using the standard annual calculation method, at month 12 the system will calculate any National Insurance due based on the earnings for the whole year. This final reassessment is to ensure the correct deductions have been made for the full year.
• When creating a pay run it is the pay date that determines the tax period, so any pay runs with a pay date of the 6th April onwards will be created in the new tax year.
• If you have published the P60s and then process a pay run for the tax year they cover, you will need to re-publish any employee P60s affected.
• If you need to make any changes to the payroll after you have sent the final FPS guidance for this can be found here.
• National minimum wage increases apply to the next full pay reference period after the 6th April, this is not necessarily the next pay date after the 6th April.