please see the real time information (rti)

Payroll and End of Year Processing
User Manual and Customer Agreement
We accept the terms and conditions set out in this document:
Signed _______________________
Dated ____________________________
Capacity in which signed ____________________________________________
Crown copyright forms are reproduced with the permission of the Controller of Her
Majesty s Stationery Office
Table of Contents
Limited Licence .................................................................................. 3
What is PAYE2000? ............................................................................. 4
Getting started .................................................................................... 6
Changing the master spreadsheet ................................................................ 7
Starting PAYE2015 .............................................................................. 8
Opening the Payroll ............................................................................ 10
Day to day payroll .............................................................................. 14
Sundry notes and details........................................................................ 22
Real Time Information (RTI) .................................................................. 26
Earlier Year Updates ........................................................................... 33
P11D processing ................................................................................ 34
Automatic enrolment and NEST ............................................................... 35
Limited Licence
The Licence hereby granted to the Customer by Quality Management Software Ltd
( the Supplier ) shall take effect in respect of the Payroll / End of year Return
( PAYE2000 ) for the year of assessment 2014/2015.
The Supplier reserves the right to terminate the licence agreement granted forthwith
on giving notice to the Customer in writing.
The Supplier shall have no liability in any way arising out of the use of PAYE2000
and the Customer by using the software acknowledges this. It is imperative that the
user of PAYE2000 understands that it is not a substitute for the knowledge and skill
of a payroll practitioner. PAYE2000 has been designated to assist the practitioner not
to replace him or her and accordingly users should always check the calculations and
end of year Return before it is submitted.
Software Support
Telephone support is available to help users solve any questions they have with the
functionality of PAYE2000 on the following numbers:
01483 429078
01453 761956
Andrew Bolton
Rebecca Benneyworth FCA
The Supplier undertakes to respond to messages left on voicemail within eight hours
of the call being lodged between the hours of 9.00 am to 4.00 pm Monday to Friday.
The Supplier will endeavour to respond quickly to any call. Any special
circumstances which prevent this response time being met at any time will be reported
on voicemail.
The Supplier will provide support for the installation for approximately one hour to
assist the customer in using PAYE2000 for no extra charge. Any additional training
time will be charged at £100 an hour by agreement in writing with the Customer.
The support will not provide technical tax or payroll advice. Enquiries about these
subjects should be directed to HMRC.
This document represents a limited licence granted to the Customer by the Supplier.
PAYE2000 may not be reproduced in any way, lent or sub-let to any other third party
without the express permission of the Supplier.
What is PAYE2000?
PAYE2000 (© Quality Management Software Ltd) is an Excel spreadsheet that is
designed to assist employers and practitioners with payroll and completing end of
year Returns. It allows the user to quickly and simply complete information on screen
as they would on paper. It performs the calculation of tax and National Insurance
following HMRC s guidelines.
PAYE2000 includes a database which allows you to keep track of employer and
employee information from year to year and to store payroll data and each year s
return. The database also allows you to monitor the submission of returns to the
Please note the demonstration version includes a built-in database which allows one
employer and one employee, there is no separate database file.
Before installing PAYE2000
PAYE2000 has a database and you must ensure the appropriate Excel options are
installed in order to use it. The Setup program in earlier versions of Excel or
Microsoft Office includes these options. From Office 2000 onwards the options are
automatically included. You may need your original Office CD or disks.
Run Setup and choose the Add/Remove option. Confirm that you have installed the
options which allow Excel to use a database. These are referred to as:
Office 97
Data Access
Please select all the sub-options by selecting the all option or ticking the boxes with
the mouse.
If you have any doubt please contact QMS for advice.
Getting started
What do you need to run PAYE2000?
To run PAYE2000 on your PC you should have:
A Pentium with a minimum of 32 Mb of RAM, preferably 64 Mb
A copy of Microsoft Excel 97 or above
A knowledge and understanding of payrolls and the end of year Return
The Revenue has approved printouts from a HP LaserJet printer
Installing PAYE2000
The PAYE2000 spreadsheet should be copied into any suitable folder.
Insert the PAYE2015 Spreadsheet CD into your CD drive.
Select the My Computer icon on your desktop;
Select the CD drive;
Select the file PAYE2015.xls
Select Edit, Copy
Find and Select the suitable folder
Select Edit, Paste, this action should cause the PAYE2015 spreadsheet to be
copied from the installation CD to your PC.
Installing the database.
Warning: Do not install a fresh empty database if you are bringing forward
information from last year.
Insert the PAYE2000 disk into your a: drive.
Copy the file PAYEDATA from the CD to the C: drive in a similar manner to
that used for the PAYE2015 spreadsheet;
You can choose the C:\ directory, if you choose another directory:
Update your master Spreadsheet with the name of the directory (see below).
Changing the master spreadsheet
You only need to change the master spreadsheet if you are planning to use the
database and have copied the database to a directory other than the C:\ directory. You
should move to the right of the introductory screen and see a display similar to the
Figure 1
Enter the following information:
the location of the database in cell H6
HMRC user id and password for submitting in year movements and the end of
year return by the internet (you can change them when you prepare the
Remember to save the spreadsheet with File and Save.
Starting PAYE2015
Open Microsoft Excel, select File, Open and choose PAYE2015 from the
spreadsheets available.
Using the database
The database contains two main sections: the employer and employee information.
Move to the employer screen and see the display. The buttons allow you to retrieve,
save and delete employers from the database. Similarly the employee screen has
buttons which allow you to retrieve, save and delete employees from the database.
Any information which is employee related (such as P60s) is saved with the employee
options. Information which is employer related (such as an RTI submssion) is saved
with the employer options.
Working with PAYE2000
PAYE2015 is a computer system which helps employers and agent prepare payroll
and end of year returns. PAYE2015 is not a substitute for the knowledge and skill of
a payroll practitioner, it assists you with the routine tasks of data entry, transcribing
figures from one schedule to another and calculating tax and national insurance.
What can it do?
PAYE2015 allows you to enter all the necessary information for an employer s
payroll, it automatically calculates the tax and national insurance liability and allows
you to print payslips, reports, P11, P32, and P60s. It also prepares an employer s RTI
submissions for filing online.
PAYE2015 uses HMRC specifications for calculating tax and national insurance. As
part of the accreditation process the calculations are checked and agreed to the nearest
penny. If you enter all sources of income correctly then the tax and national insurance
will be correct.
Real Time Information
We have developed the software to prepare Real Time Information (RTI) for HMRC
and gained recognition for the tax year 2014-15.
Opening the Payroll
A new Employer
After opening Excel, select File then Open and choose the PAYE2015 spreadsheet.
This is the first screen you will see:
Figure 2
The buttons take you to the appropriate screens and buttons on these screens will
guide you through the other options.
Select the employer button and move to the following screen:
Please remember to select the Remove details button before setting up a new
You must complete and save at a minimum the following:
HMRC office (3 digits)
PAYE reference
Accounts office reference for RTI
For the payroll:
Whether employees are paid monthly or weekly, or any other frequency
(if weekly) the first pay day of the tax year, usually the first Friday
(if monthly) the start day of each month (usually 1)
Lower down: confirmation that the employer is part of RTI
Data can also be provided for the HMRC office, eligibility for small employer s relief,
entitlement to the employer s allowance (£2,000) and departments within the
Please select the Retrieve employer button to bring forward employer information
from the previous tax year, and select the Retrieve all employees to bring forward
each employee after you have brought forward the employer. This will automatically
increment the latest tax code (if an L code) by a fixed amount, for 2014-15 this is
A new employee
Select the employee button on the first screen and move to the following screen:
Please remember to select the Remove details button before setting up a new
You must complete and save at a minimum the following:
Date of birth
National Insurance number (We advise you to include the NINO, the RTI
process needs it)
For the payroll:
Starting period (usually 1) and the tax code
Starting period (usually 1) and the NIC table letter
Data can also be provided for the joiners, leavers, directors, student loans,
departments. Warning messages are shown in red, you need to remove the cause of
the warning otherwise later processing may not work.
You can bring forward an individual employee from the previous year by selecting the
Retrieve employee button.
NOTE for RTI users
You will not have to submit a P35 and P14s at the end of the year but you still
need to go through the process of preparing a P32. We recommend you prepare an
EOY summary because it summarises the tax and NI and can be used to reconcile
payments to HMRC. You will have to complete at least some of the P35
especially page 4 because this information is included in the final RTI submission
of the EPS (see the RTI section later).
Day to day payroll
The payroll contains sections for a large number of options which are required for
HMRC acceptance tests, many of them are not used in normal day to day processing.
The minimum requirements are as follows and can be reached from the employee
screen. Please note that references to month also refer to week or any other pay
period depending on the pay frequency selected on the employer screen.
Selecting the What is paid button on the employee screen leads to:
You must enter the starting month number, usually 1, and the basic salary for each
period. Once you have entered the salary you do not have to enter another unless it
changes. The month 1 salary is used for each subsequent month. If the salary
changes, say in month 6, enter 6 and the new salary underneath the month 1 figures.
The extra boxes to the right are for employee and employer pension contributions.
The on strike tick box is used to restrict tax refunds while on strike.
Alternatively you can enter the number of hours and a rate per hour, the calculated
salary will show in the Salary column. These details will also show on the payslip.
Lower down the screen you find the adjustments screen:
The description will be printed on the pay slip. The adjustment can be positive or
negative and can be taxable or not and NICable or not. Each adjustment by default is
for the starting month and every subsequent month, if it is only for the starting month
then tick the appropriate box. Tick the final box if the adjustment is a benefit, it is
reported separately in RTI.
Tax Codes
Selecting the tax code button on the employee screen leads to:
Enter the starting month (usually 1) and the tax code and tick if it is a Week1/
Month1 basis. The What is paid convention is followed, once you have entered a
code it is used for the starting month and all subsequent months unless you enter a
new month and code underneath the first month. The separate boxes for Tax code
and the tick box are updated after you run the payroll, they represent the most
recently used information.
National Insurance codes and Directors and Starters
Selecting the NIC codes button on the employee screen leads to:
Enter the starting month (usually 1) and the NIC code. The What is paid
convention is followed, once you have entered a code it is used for the starting month
and all subsequent months unless you enter a new month and code underneath the
first month.
Information about directors is included lower down, this affects the calculation of
New members of staff.
Information about the previous employment of new members of staff is included
below, you can check the P45 data (or leaving notice) for tax already deducted in a
previous employment.
Move down the employee screen to see:
And tick the box to get the next screen:
New employees will either bring a leaving statement with details of earnings or will
sign a P46. Enter the appropriate information for the employee or, lower down, the
P46 information.
NOTE: The P45s can be printed on plain A4 stationery following HMRC guidelines,
the P45 acts as a leaving statement which the employee can show the new employer.
RTI Users
Joining and leaving information is now captured with the start and end dates and
included in the first payment details for joiners or the last for leavers. Please
remember to add the appropriate joining or leaving dates before you run the
payroll. You can t submit a P45 or P46. However you will need to record a
joiner s pay and tax information to date in order to continue calculating tax
correctly. You will also need to prepare a leaving statement for leavers, HMRC
has told us the P45 acts as a leaving statement.
The Control Panel
Selecting the Control Panel button on the employee screen leads to:
You must first select a pay period with the up and down arrows and then the button
to calculate pay for this period or all periods from the start of the year up to the
selected period. The payroll process first removes any pay details previously
calculated and recalculates the pay.
The button Prepare payslips and the payroll summary report for all employees
works out the pay for the selected period, prepares a report and optionally prints the
payslips for all employees. Please remember to save the current employee first if you
have not already done so. If you have a mixture of weekly and monthly employees
you can use the dropdown to select the appropriate category.
You must use the Prepare payslips ... option for RTI FPS submissions.
HMRC requires that each regular submission includes all employees in the
particular category (weekly or monthly) and must be submitted before the
appropriate paydate.
The payslips are designed to be printed on special A4 stationery avail window. One
payslip is printer per page, the page is folded in two and the employee s address is
visible through the window. The stationery is referred to as Mastermailers, reference
MAILPAD or MAILPADF. The latter has a postal franking band and could be
QMS Ltd and its directors and staff do not have any financial interest in Econoprint.
A section of the payroll report is as follows:
The report shows department subtotals if appropriate.
Sundry notes and details
You can access other sections of the payroll from the buttons on employee screen.
The following describes information on the various screens.
Different pay periods
If different employees have different pay periods e.g. weekly and monthly and work
for the same employer you will need to work out pay for each employee in turn, not
all together. This will prepare the P11, please remember to save the employee
information to the database. Return to the employer screen and choose the P32
option to prepare the P32 for the employer.
Director (previously employee) appointed during the year
HMRC recommends that a new P11 be started. The old P11 will have a leaving date;
the new P11 will have details of earnings in the previous job (i.e. prior to becoming a
director). You will need to distinguish the name of the employee (e.g. by adding
(Director) to the name). You will prepare two P60s at the end of the year. The first
will show the tax, earnings and NI prior to becoming a director. The second will
show the cumulative tax and earnings and also show the director s NI.
Director ceasing to be a director during the year but continuing as a paid
HMRC recommends that a new P11 be started. The situation is the reverse of the
Holiday pay
We calculate holiday pay following HMRC s examples for weekly paid employees.
In particular we use Method B for calculating NICs, this uses the whole sum based on
the number of weeks it represents. We follow the suggested option number 1 (apply
the 3-weekly lower and upper earnings limits and earnings threshold to the total
payment and round the resulting NICs figures to the nearest penny, rounding down
exact amounts of ½p, in the normal way). Note that the revised earnings threshold
(for NIC) must be obtained from the annual value and is not just a simple multiple of
the weekly value. The lower and upper earnings limits are multiples of the weekly
Statutory pay
The amount of statutory pay depends on average earnings prior to the period of
statutory payment. The payroll software calculates the average based on the payroll
history using the previous 8 weeks employment record. There may be situations
where the average cannot be calculated, for example where there is an incomplete
history or some of the payments were in an earlier year. Remember that average
earnings can affect the amount of SMP in the first 6 and subsequent weeks. You may
need to calculate average pay separately and enter the average figure on the
appropriate screen (SMP, SAP, SPP).
If you are backdating a pay rise which affects the calculation of average earnings
don t forget to re-calculate the average. This does not overwrite SMP which has
already been paid. However, SMP still to be paid (and recovered) will be increased to
take account of any past underpayment.
Employer s departments
You have the option to specify departments. Please add a department to the list on the
employer s screen. When you add an employee you can select a department. The
payroll will be summarised by department enabling you to prepare the appropriate
account entries for book-keeping purposes. If you don t use departments the payroll
report will show an overall total.
Pension contributions
The payroll allows you to make straightforward pension contributions either as a lump
sum or on a percentage basis. These can be ticked as tax deductible or not. More
complicated scenarios such as when an employee makes standard contributions to a
pension scheme and also makes Additional Voluntary Contributions are also possible.
In this case you should indicate the standard contribution next tot the salary entry box
and lower down the screen include the AVC as a negative adjustment to pay with an
appropriate description. Both contributions may or may not be deductible for tax and
both will appear on the payslip.
Paying Statutory Sick Pay (SSP) and cut off day for payments
SSP is included in the appropriate weekly payslip for weekly paid employment but
only up to a certain day of the week. For example, if someone is paid on Friday then
the days of sickness will be notified typically up to and including Thursday
immediately before the Friday. You must enter the day of the week, in this example
Thursday. The selected day can be the same as the pay day. Any sick days not
included in the first week s pay will be included in the following week s pay.
SSP is included in monthly payslips but only up to a certain number of days before
the end of the month. This can be zero or you can choose a number such as 5 days,
i.e. SSP for sickness in the last 5 days will not be included in the current month but in
the next month.
Sickness periods are entered lower down the SSP screen on the left hand side. The
payroll program will calculate PIWs, waiting days and entitlement to sickness. You
may need to enter the average weekly salary if there is insufficient payroll history to
calculate automatically.
You can select a different pattern of Qualifying days, the default is Monday to Friday.
Earnings orders
You must provide the following information. All orders require:
Start date
End date (if appropriate)
Date of issue (used to prioritise different orders)
Date of receipt (used to prioritise different orders)
Priority and non priority AEOs and DEOs need:
Initial amount
Amount in previous year (if appropriate)
The protected amount (may be 0)
The normal deduction
Real Time Information (RTI)
RTI processing has been tested successfully during the pilot phase in FY2014 with
There are six items: starting RTI, day to day processing, what you have to do at the
end of the tax year, interim Employment Payment Summary, ad hoc requests and
Earlier Year Updates. HMRC advises that you make sure employee information is
complete, accurate and up to date before RTI starts, especially that you have correct
dates of birth and National Insurance Numbers.
Starting RTI
HMRC will inform the employer it has started RTI, this is not necessarily at the start
of the tax year. Go to the employer screen and move down to see the following:
You need to tick the joining box and put a cut off date (6th April or perhaps the 1st of
the month of starting RTI). You will also need the Accounts Office reference (higher
up the screen) if you have not already entered it. Remember to save the changes in the
There are two steps: the Employer Alignment Summary (EAS) and optionally the
first FPS . HMRC may have provided other guidance but this is the best and
unambiguous way with our payroll software of starting RTI.
Please select the EAS button, this prepares and sends details of all employees on the
payroll to HMRC. You may need to also send the first FPS, this sends details of all
employees who have left between the start of the tax year and the cut off date,
obviously if the cut off date is the same as the start of the tax year there will be no one
to send and so the process is redundant.
Day to day RTI processing
You must use the control panel option to prepare the payroll and the RTI submission.
This option prepares the RTI submission for the week or month which you have
selected as well as the ordinary payslips and the normal summary report for the
payroll. The option prompts you for the user id and password and whether you want a
test or live submission. If you choose test, you will have to run the option again and
choose live.
After the payroll has been prepared you have an option to submit immediately, if you
decide not to submit, you can submit later using the submit button.
You can t send P45s and P46s to HMRC. You must include the starter and leaving
dates in the employee screen before you run the payroll, the RTI submission
automatically includes the necessary information.
Re-joiners who have left earlier in the tax year (an annoying problem at HMRC): if
you have a re-joiner you must provide a new Works/Staff number (even if
artificial). HMRC need this to distinguish two separate periods of employment.
Irregular or infrequent payments: please use the tick box on the employee
screen, if HMRC does not receive any pay record for 13 weeks they will close their
record, without the irregular flag a subsequent submission will create a second pay
record for the same person and may cause complications at the year end.
The end of the tax year and RTI
These steps must be repeated for each employer.
After you have run the last payroll and submitted the FPS in the tax year 2014-15
please return to the employer screen. There are a number of straightforward steps to
follow for end of year processing:
Prepare the P32;
Go to the P32 to review;
Go back to the employer screen;
Prepare P60 for all employees, you get an option to print the P60s;
Prepare EOY Summary, this summarises the payroll totals on the P35;
Go to the P35 to review, especially page 3 where you can add any extra
recoveries, and page 4 where you must tick the appropriate boxes;
Go back to the employer screen;
Tick the box for Final EPS;
Prepare the Employer Payment Summary (EPS), you must select No for Live,
and you must confirm that you want to submit the EPS after preparation;
Select the Press here to record in the database button.
Interim EPS
You can submit an interim EPS if you wish to set off the recovery of statutory
payments against your regular tax and NI liability. You need to prepare a P32 first
to summarise any statutory payments and then select the Prepare EPS button
without ticking the final EPS button.
If you have no recoveries to make and no employee payments in any month
then you should submit a NIL interim EPS return: please choose the
appropriate tax month and select the prepare EPS button. You must do this after
the 5th of the month (ie after the end of the tax month) this is an HMRC
restriction. So if there no payments in January then after 5th February you can
submit a NIL return for January.
You can also look forward : if you know you have no FPS in the following
month(s) you can select the months for a nil interim EPS.
Keeping track of submissions
PAYE2015 automatically keeps track of internet submissions and responses (the
replies to earlier submissions) in the database. Each time you prepare a return the
employer s record in the database is updated. After the end of year return is
processed by HMRC please return to the employer screen and select the button to
record the success in the database.
You can review submissions and responses by clicking the Summarise responses
button on the employer screen.
Ad hoc requests
NINO Verification Request (NVR)
You can request confirmation of an employee NINO or provide details of an
employee and obtain the NINO. Go to the employee screen and see the following:
Select this option to submit a request.
Note: you only receive acknowledgment of the submission, you do not receive the
actual response. At some later time (still to be confirmed by HMRC) you must run a
separate option to obtain the responses, see the next page.
Please move to employer screen and scroll down to see:
You can only use these options if you are the employer or an agent with a 64-8 in
place. A filing only agent will not get any results.
The P6 and P9 options will retrieve tax codes which HMRC has placed in the
employer s electronic mailing box.
The NINO option will retrieve NINOs from previously submitted NINO verification
requests or from HMRC s own notifications, possibly where you have filed a Full
Payment Submission with the wrong employee NINO.
The results are shown on the Submission screen and can be printed out. The changes
are not applied automatically, it is up to the user to review and make any changes to
employees records.
Earlier Year Updates
An Earlier year update is a correction to previously submitted FPS in the tax year after
the year of the original submission. It is incremental not absolute, in other words it is
the change (positive or negative) typically in the pay or tax deducted. You need to
enter the incremental change on the appropriate employee s P60 deleting any other
information and save the employee to the database. In addition you need to mark the
employee record. This should be repeated for all employees who need an update.
Then on the employer screen select the button Prepare Earlier Year Update button
to send the information to HMRC.
The following link gives more information:
and information about late reporting:
P11D processing
We have added P11D processing. You need to set up employers and employees with a
minimum amount of information if you have not used the payroll. The payroll
information is not sent to the Revenue as part of the P11D process.
Please choose the P11D button on the employee screen to go to:
You can scroll down the screen to access the various HMRC working sheets. Standard
values such as mileage allowances are built in to the P11D. The screen follows the
Revenue s numbering and naming conventions and it is designed to capture
information which will be submitted electronically. It is not an approved printed
The buttons marked Working Sheets take you to supporting schedules, the totals of
the schedules are copied back to the appropriate boxes on the main P11D schedule.
Please remember to save the employee to the database once you have entered the
P11D details. Once you have added the necessary P11D information for each
employee please return to the employer screen and select the Prepare P11D button
to prepare and submit the return to HMRC. You can review the P11D(b) summary
and print it for your records.
Automatic enrolment and NEST
The payroll software has details which can be used as part of auto enrolment process
for pensions. We store information which allows you to transfer payments to NEST.
Each employer must register with The Pensions Regulator (TPR) and NEST. The
registration is outside the control of the payroll software. As part of the registration
process you will receive some information which must be added to the employer
screen. What you receive is:
a) The NEST reference number, used to identify the employer to NEST;
b) The NEST payment source identifier, this is usually something simple such as
bank , NEST has the option to collect payments from a number of sources,
this is unnecessary for small employers;
c) One or more NEST group identifiers, this is used to control groups of payment
details, typically as monthly or weekly submissions and the simple approach is
to call the groups monthly or weekly for the appropriate payroll runs;
d) The staging date from TPR;
e) The deferred auto enrolment date from NEST. TPR advise that you should
make the best use of the postponement options to allow time to become
familiar with auto enrolment and notify all your employees.
Once you have indicated on the employer screen that it is auto-enrolling its employees
then all employees will be included in the NEST calculation unless you mark on the
employee screen to exclude an employee. The Control panel option prepare payslips
and payroll summary report will automatically prepare a file of contributions which
you can submit to NEST.
The payroll calculates the NEST contributions using the standard percentages for
employer and employee contributions. The employee contributions can be net or gross
of the basic rate of tax. We do not apportion contributions in the first pay period, you
should choose an enrolment date at the start of a pay period.