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How to transfer an employee between payroll schedules

This article explains how to transfer an employee from one payroll schedule to another while maintaining their year-to-date (YTD) payroll values and ensuring continuity of payroll calculations and reporting.

Before you start

Make sure the following requirements are met before transferring an employee:

  • All payroll schedules must be finalised for the current period.
  • The transfer must be completed before the next payroll period is started.
  • The transfer must be effective from the first day of the new month/payroll period.
  • The source and destination payroll schedules must be under the same PAYE reference.
  • The employee must not be transferred mid-period.

Why it matters

Following this process helps to:

  • Prevent duplicate or conflicting YTD values from being reported on the Full Payment Submission (FPS).
  • Maintain continuity of tax, National Insurance (NI), statutory pay, pensions, student loans and postgraduate loan calculations.
  • Avoid HMRC mismatches involving Employment ID, PAYE reference and YTD values.
  • Ensure Benefits in Kind values continue correctly after the transfer.

How to transfer the employee

Complete the following steps in order.

Step 1: Update the employee's Regular Pay

  1. Navigate to People then Payroll
  2. Go to Regular Pay
  3. Select Add New
  4. Set the Effective Date to the first day of the new payroll period
  5. Update the employee's Regular Pay to reflect the new payroll schedule
  6. Save the changes

📝Note

The Effective Date must align with the start of the new pay period. Do not use a mid-period date.

Step 2: Update Employee Year to Date values

  1. Navigate to People then Payroll
  2. Go to Opening Balances
  3. Select Add New
  4. Update the relevant YTD values, including:
    • Current Employer Gross Pay
    • Current Employer Tax Paid
    • Statutory pay, if applicable
    • Student loan values, if applicable
    • Pension YTD values, if applicable
    • Any other relevant values
  5. Select Save

📝Note

If P45 figures are already present, update the existing record with the Gross Pay and Tax Paid values. Retain the existing P45 figures rather than replacing them.

Step 3: Update National Insurance YTD values

  1. Navigate to People then Payroll
  2. Go to Opening Balances then open NIC Summaries.
  3. Populate all National Insurance YTD fields using the values from the previous payroll schedule.
  4. To find the gross earnings breakdown, open the most recent FPS and refer to the YTD figures
  5. Select Save and Close

Step 4: Update Benefits in Kind YTD values

  1. Navigate to Payroll then Benefits in Kind
  2. Open the relevant Benefit in Kind record
  3. Make a note of the Benefit to Date Amount
  4. Update the Benefit End Date to the last day of the previous pay period
  5. Add the same benefit again, using the first day of the current pay period as the start date
  6. Update the Opening Balance with the Benefit to Date value noted earlier
  7. Select Save and Close

This ensures the benefit value is carried forward correctly into the new payroll period.

Complete the transfer

Once all the steps above have been completed, the employee's payroll information should be aligned with the new payroll schedule, with the relevant YTD values carried forward.