UK payroll has a monthly cycle (RTI submissions on or before each payday) plus annual filings: P60 to employees by 31 May, P11D to HMRC and employees by 6 July, Class 1A NIC payment by 22 July. Late submissions and payments attract escalating penalties. From April 2026, most benefits in kind must be payrolled in real time, phasing out P11Ds for most employers.
For most UK employers, payroll is the most-regular compliance obligation — multiple deadlines every month, plus annual filings. The right tools (Xero Payroll, BrightPay, Sage Payroll, FreeAgent Payroll) handle it largely automatically, but the legal responsibility remains with the employer.
The monthly rhythm — RTI
Under Real Time Information (RTI), every UK employer reports payroll data to HMRC on or before each payday.
The Full Payment Submission (FPS)
- Submitted: on or before each pay date.
- Contains: each employee''s gross pay, deductions, net pay, tax code, NI letter, employer NIC.
- Deadline: on or before the payment date. If you pay on 25 March, FPS must be submitted by 25 March.
The Employer Payment Summary (EPS)
- Submitted: monthly (or less frequently, but not later than the 19th of the following month).
- Contains: reductions claimed (Employment Allowance, SMP recovered, etc.), nil-payment reports.
PAYE and NIC payment
- Due: 22nd of the following month (or 19th if paying by post — rare).
- Direct debit, BACS, or Faster Payment.
For monthly payroll, the 22nd is the absolute deadline. Quarterly payers (small employers under £1,500/month PAYE) pay quarterly.
The annual cycle
After the tax year ends (5 April), three further deadlines:
Final FPS or EPS marked "final"
- Due: by the 19th April following the tax year.
- Marks the final RTI submission for the tax year.
P60 to employees
- Due: 31 May following the tax year end.
- Required: for every employee on payroll at 5 April.
- Format: written or electronic (paper not mandatory).
- Contains: total pay and tax deducted for the year.
For a tax year ending 5 April 2026, P60s must be issued by 31 May 2026.
P11D and P11D(b)
The traditional way to report benefits in kind given to employees and directors that aren''t payrolled.
- Due: 6 July following the tax year end.
- Provided to: employees (their copy) AND HMRC.
- Contains: each benefit and its taxable value.
- Class 1A NIC on benefits: payable by 22 July (or 19 July by post).
Examples of reportable benefits:
- Company cars (and fuel).
- Private medical insurance.
- Gym memberships.
- Loans over £10,000 to employees / directors.
- Excessive accommodation.
- Reportable expenses (those outside business-as-usual travel).
Coming change — mandatory payrolling of benefits from April 2026
From 6 April 2026, most benefits in kind must be payrolled in real time — meaning the BIK value goes through the payroll each month and the employee pays Income Tax (via PAYE) on it as it''s provided.
Effect:
- Most P11Ds are phased out for most employers.
- The benefit value appears on the payslip and P60, not on a P11D.
- Class 1A NIC is still due (and a P11D(b) still required) to declare and pay it.
Two notable exceptions initially remain on P11D:
- Living accommodation provided to employees.
- Beneficial loans.
If you''re not already payrolling benefits in 2025/26, you need to register with HMRC before 5 April 2026 (the start of the next tax year). Once registered, you can''t reverse for that year.
Late submission penalties
RTI late filing
First default per tax year is excused. Each subsequent default in the year attracts an automatic penalty:
- 1-9 employees: £100/month.
- 10-49 employees: £200/month.
- 50-249 employees: £300/month.
- 250+ employees: £400/month.
Plus, late filing 3+ months risks a 5% surcharge on the unpaid PAYE/NIC.
Late payment of PAYE/NIC
Quarterly default surcharge regime — escalating from 1% to 4% of the unpaid amount.
Late P60 / P11D
- P60 late: technically a penalty up to £300 per employee, though HMRC rarely enforces if the P60 is only days late.
- P11D late: up to £300 per employee for the initial offence, more for continued non-compliance.
How to file
Payroll software with built-in RTI
Standard for almost all UK employers. Xero, QuickBooks, Sage, BrightPay, FreeAgent, MoneySoft, Capium, Iris — all handle FPS, EPS, P60, P11D, payrolling benefits.
HMRC Basic PAYE Tools (free)
For very small employers (up to 9 employees). Free download from HMRC. Limited functionality but compliant.
Outsourced payroll
For employers who prefer not to manage payroll internally. A bookkeeper / payroll bureau handles everything for £5-£25 per employee per month.
For employers with 5+ employees and complex elements (pension contributions, sick pay variation, benefits in kind), outsourcing often costs less than the equivalent in-house time.
Common payroll mistakes
Late FPS
Submitting the FPS the day after payday. Even one day late triggers a penalty after the first excused default.
Missing the EPS for nil-payment months
If you pay nothing in a month (e.g. dormant payroll, or all employees on unpaid leave), you must submit an EPS confirming nil payment. Forgetting this is a common cause of HMRC chase letters.
Tax code errors
Using last year''s tax code at the start of the new tax year (April). Tax codes update annually and HMRC issues new ones — must be applied for the first pay period of the new tax year.
Forgetting Employment Allowance claim
Up to £5,000 per year off employer NIC for eligible employers. Claimed via EPS. Often missed by first-time employers.
Not registering for payrolling benefits before April 2026
The April 2026 deadline is sneaking up. Employers giving benefits in kind need to register by 5 April 2026 (for 2026/27 tax year) — too late after that.
What to do this quarter
- Audit your payroll system: are FPS and EPS being submitted on time?
- If you give benefits in kind: plan the payrolling registration before 5 April 2026.
- Calendar P60 deadline (31 May), P11D deadline (6 July), Class 1A NIC payment (22 July).
- For small employers, claim Employment Allowance if eligible.