Earlier Year Updates (or EYUs) are used to correct information submitted in the previous tax year.

FPS submissions for tax years close on the 19th April. If you need to make amendments to the employee PAYE totals after this date then you are required to submit this information in the form of an EYU.


To view the EYU submissions screen you need to go to ‘Employee > Earlier Year Update‘.


You can select the employee to be updated by highlighting them in the company tree before opening the EYU submissions window. You can also choose the employee using the drop-down menu at the top of the EYU window. This allows you to select the employee by name or by staff number.


An EYU uses change values to update the year-to-date figures for an individual employee. If an employee has been over or underpaid in a previous tax year, take a backup of your payroll and print or save a copy of their P11s (both the Combo & NIC). Reprocess the employee so that their pay is correct and print or save a copy of the updated P11 Combo and P11 NIC.


These print-outs will be used to work out what figures you need to submit to the HMRC and need to be accurate. It is therefore very important that you remember to take a backup and printout these reports.




Example of EYU Calculation

Below is an example of an employee who has been overpaid in month 11, Note month’s 1-10 are not shown.




Original P11 Combo


Corrected P11 Combo



Calculating Liability Imbalance

Below is the calculation to work out what you need to submit to the revenue. This example is based on the idea that you have a liability imbalance with the revenue.


If you have simply missed a monthly/weekly submission, then you do not need to work out the difference. You will just need to submit the totals for the missing months/weeks.



Original YTD  

Taxable Gross = 20,555.37
Tax Paid = 2,109.20
Employee’s NI = 1,445.28
Employer’s NI = 1738.75

Re-calculated YTD

Taxable Gross = 20,000.04
Tax Paid = 1,998.00
Employee’s NI = 1,551.29
Employer’s NI = 1662.12

EYU Amount

Taxable Gross = -555.33
Tax Paid = -111.20
Employee’s NI = -106.01
Employer’s NI = -76.63



Tax


Enter in the tax details that you have calculated. Remember: you are sending the difference between the original wrong figures and the corrected figures. You can send a minus value if you need to. Any fields that are coloured in yellow cannot be filled in. In this example the employee is male so SMP is not an editable value. Date submitted and correlation ID will be populated once the submission is sent.


National Insurance


The national insurance breakdown can be calculated in the same way as the tax using the P11 NIC, The gross earnings can be calculated by summing Up to LEL, LEL to PT, PT to UAP and UAP to UEL.


Submitting to HMRC

Once you have filled out both lines of information (it is advisable to fill any blank or unused fields with zeros) and are happy that the information is correct, you are ready to submit. Firstly you should press ‘Save‘ and then press ‘Submit‘.


Once successfully submitted, like any other RTI sent to HMRC you will receive a ‘Correlation ID‘. Should you ever need to speak to HMRC about this submission, this Correlation ID will be the reference you can use.


The information above is meant as a general guide and some imbalances may be a little bit more complicated to resolve. If you are unsure of how to calculate your liability imbalance then call HMRC and request a breakdown of the information they have for your company. This will help when identifying the difference between your totals and the totals HMRC have for your company.


For further information on EYUs, visit the HMRC website:
https://www.gov.uk/payroll-errors/correcting-your-fps-or-eps



Need More Help?

Contact Support

Contact Support

Our team are here to help.

Blog

Blog

Read our latest blogs on all things Payroll.

Video Tutorials

Video Tutorials

Check out our Video Tutorials.