Payroll year end

At the end of each calendar year, you'll need to process your year end values to produce an Employment Detail Summary for your employees.

Note: We're updating Sage Business Cloud Payroll at the end of November with all the legislation changes and calendars for the new tax year. We'll let you know when this is available, so there's no need to check back. You won't be able to process in the new tax year before the update.

 

To complete one tax year and start a new one, simply:

  1. Process and submit your final pay period in the current tax year.
  2. Set up the next tax year.
  3. Process and submit your first period in the new tax year.

Part 1: Prepare for year end

Check if you have an extra pay run (week 53)

If you process weekly, two-weekly or four-weekly payroll, you may have week 53. If you have an extra pay run, this is your final pay run of the year and you should process this as normal.

Note: You will only have an extra pay run when the regular pay date for weekly, two-weekly or four-weekly paid employees falls on either Wednesday 30th December or Thursday 31st December. Monthly pay frequency will not have an additional pay period.

 
Process leavers, if applicable

Before you process your final pay run, you need to enter the last working day for any employees who have left your employment during this period.

Process the final pay run of 2020 and any holiday pay

Before you create your year end returns, you must complete your final pay run of the 2020 tax year.

If any of your employees are on holiday and this happens to span year end, you should process their holiday pay up until the end of the 2020 tax year. Then process a new payment in week 1 of the new tax year to reflect the remaining holiday payments.

Part 2: Run the year end

Review your employees' pay

As part of the year end routine, you must review your employee pay to make sure their values and the information you submit to Revenue is correct. If you need to amend any pay values for your employees, please do so via the corrections process.

Produce your reports for your employees

Revenue will now produce an end of year statement (EDS) for all employees, which includes details of all their pay and deductions for all employments in that tax year.

Employees are able to view and print this statement directly from the myAccount portal on the Revenue website. Any employee unable to use this service will need to contact Revenue directly to request a paper version.

Send the Employee Details Statement to your employees so they can check Preliminary End Of Year Statements, issued by the Revenue on 16th January.

Part 3: Starting the new tax year

In the next few weeks, your Payroll service will be ready for processing in the 2021 tax year.

Until then, if you complete your 2020 processing and try to move into your first pay run of 2021, the following message appears:

"You have reached the end of the current tax year. The payroll updates for the new tax year are currently unavailable, so you cannot process any pay runs for the new tax year. The new payroll updates should be available approximately 1 - 2 weeks prior to the start of the new tax year."

Retrieve RPNs

From 1st January 2021, you must request 2021 RPN’s for all employees for the first payment in 2021. If no RPN’s are available, then you must operate the emergency basis of income tax and USC.

RPNs provide you with the necessary information to deduct the correct tax, universal social charge (USC) and local property tax (LPT), if applicable. In Payroll, you retrieve and import the RPN’s when you process a pay run.

If an RPN is not available for a new employee, the service attempts to generate a new RPN for any new employees with a PPSN and an Employment ID.

If the RPN indicates that an employee should be set to PRSI exempt, you must manually select a PRSI Exemption reason from the Edit Tax Details that displays when you click the employee’s name at the top of Edit Pay.