HMRC announced back in the tax year 2017/18, that effective from 6th April 2019, The Full Payment Submission (FPS) would be available to employers that wish to notify HMRC of any revised Year to Date payment data for the previous tax year. This meant that tax year ending 5th April 2019 would be the final tax year in which an employer would have been able to report adjustments using the Earlier Year Update (EYU). The tax year ending 5 April 2019 was effectively the pilot year in which employers would have a choice, software permitting, to use either the EYU process or the new FPS.
Following HMRC’s Software Developers Support Team (SDST) update on the change to the EYU and the initial analysis from the pilot year, results have been very encouraging. HMRC therefore, want to continue to evaluate these results prior to making a final decision about the withdrawal of the EYU.
HMRC have therefore announced that they have decided to extend the pilot to include the 2019/20 tax year, effectively, this will now mean that from the tax year beginning 6th April 2020 the EYU will no longer be a valid submission.
Going forward, employers will be able to make amendments as follows:
- For the pilot tax year 2018/19, an EYU or FPS will be accepted from 20th April 2019. The use of the new FPS on the part of the employer for tax year ended 5th April 2019 remains purely voluntary.
- For the current tax Year ending 5th April 2020, employers will be able to continue to submit an EYU or FPS to make amendments to an employees previous tax year pay and tax details.
This is an extension to the pilot, the use of the FPS after the year-end is voluntary.