I don’t know if it is just me, but since it’s redesign I am finding information pages on the HMRC website much harder to find these days. One particular example was knowing how to change the tax codes for the start of the new financial year. So to help I will summarise here the changes needed for tax codes for the new tax year,
The document you need to fully explain how you should change the tax codes is the P9X. This explains the changes to the basic personal allowance and basic rate limit for tax, and tells you how to update any tax codes with an L suffix code. It can be downloaded by clicking on the link and downloading the page. The page will look familiar as it is like the letter we used to get each year before everything went on line.
For 2015 to 2016 the new allowance is £10,600, and the new emergency tax code has moved from 1000L to 1060L. The guidance is to add 60 to any tax codes ending in L. You must also remove any week one month one flags that were set in the 2014 to 2015 tax year.
If you have any staff with tax codes with a K or T then you will normally get a P9(T) form sent via your Inland Revenue Secure Mailbox and you should use the code given on the notification with the most recent date.
You may have employees with no tax code change notification, who also are not on an ‘L’ code. The details for dealing with these codes, such as BR, D0, D1 or NT are also given on the form, generally these are carried forward to the new tax year.
There are very specific instructions for dealing with new employees who start between 6th April and 24th May, which can be found at https://www.gov.uk/new-employee .
If you require any support or training in running your own payroll, then we can supply and support Sage Instant Payroll, Sage 50 Payroll, SageOne and now Xero Payroll. Sometimes hand holding training to help you through year end or the new pension legislation set up can be the best way to make sure you are doing things right.