I am using Payroll Advanced for a limited company and in the process of setting up payroll so two directors can pay themselves a salary starting this month. I have a couple of questions;
1. Under employee details I assumed the 'Start date' will be when they begin employment which would be the beginning of October 2020. Under the tax/NI section I assumed the 'Appointment date' would be when they first became a director. However, when attempting to input an appointment date earlier than the start date this was not possible. If I was to change the start date to when they were appointed as a director would HMRC not be expecting an FPS filing for every month from that date?
2. When inputting a P45 for one of the directors who was employed when the company was dormant, I am unable to put a leaving date later than the start date I have inputted for this new employment. Therefore again in relation to the above, I am unable to put the start date as the appointment date. Is it essential to use the previous P45 tax code?
3. The directors are hoping to pay themselves £8788 as a tax/NI free salary. Will QuickBooks issue 'Annual salary/12' each month, meaning the directors will not reach their full allowance by April 5th 2021? Am I able to 'increase' the Annual Salary so they are paid a higher amount until the end of the tax year and then change to a lower salary for the new tax year?
Any help would be greatly appreciated.
Thanks for your post. The start date would be the very first date they began employment with the company, and the appointment date would be the date they became director of the same company - have they previously been reported to HMRC as a director on the payroll for this company, or did this begin in October?
For the P45, you can leave this box blank but the total pay to date and total tax to date should be entered here for the tax to be calculated correctly on the payroll.
The standard annual earnings period method will be calculated on a pro-rata basis for the remainder of the tax year from the date that they were appointed if this was not at the beginning of the tax year. :)
Thank you so much for your reply!
The company registered itself as an employer a week ago.
The directors want to start paying themselves at the end of the month so I was going to put the start date as 01/10/20.
One director was appointed when the company was set up back in 2017, the other was appointed in July 2020.
When I put these dates into payroll, the appointment date always automatically changes back to the start date, no matter how times I change it again. I have ticked the Company director box. Could I have done something elsewhere to cause this to happen?
Do I need to contact HMRC before the first FPS is sent to register the directors onto PAYE? As I said earlier the company has registered with HMRC as an employer.
Many thanks for your help.
Thanks for getting back to us, @BWMEA.
If you've already run payroll in QuickBooks Online (QBO), the appointment date shouldn't go back to the start date. Since it keeps getting back, I highly suggest contacting our Payroll Support team. They have tools such as screen-sharing (remote access) that can pull up your account in a secure environment and check the cause of this odd behavior. They can also perform some troubleshooting steps to fix this for you.
Here's how to reach them:
You can also check out this article for more details in getting started with Advanced Payroll and managing employees: QuickBooks Online Advanced Payroll Hub. It includes other links like processing pay runs and guide to expenses & timesheets.
Please let me know how it goes or if you have any other issues in the comment section below. I want to make sure everything is taken care of for you. I'll be here to help. Have a good one!
I haven't run payroll yet as the first payment will be at the end of October.
I have been in contact with HMRC who said appointment date doesn't affect them and they just go by start date. To make sure I run payroll in time I feel I should put the start date and appointment date as 01/10/20 and then try and change the appointment date after this.
I can't really see how else I am going to be able to start running payroll.