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If you have a leaver that has left in a previous pay period, their departure may not be immediately acknowledged in the payroll cycle.
Get the most out of UK Payroll
- UK Payroll will automatically calculate overpaid PAYE, salary, and pensions, as well as any holiday pay or other statutory pay due.
- UK Payroll will calculate the outstanding net pay due to the late leaver or to the employer.
How to terminate a late leaver
- Navigate to Employees from the left sidebar.
- Select the relevant employee.
- Click on Actions in the top right corner.
- Select Terminate employment.
- Enter the termination date.
Note: For full instructions on terminating an employee, see Terminate and delete an employee.
- Check Backdate the termination at the bottom of the pop-up modal.
- UK Payroll will automatically calculate the gross salary adjustment based on the entered termination date. Once you are happy with the information entered, select Yes, terminate employment.
How to edit final payslips
Once you have terminated an employee, any backdated salary adjustment and holiday pay will automatically be added to the payslip preview. You can make further additions or deductions to the payslip as necessary.
- Navigate to Payrolls from the left sidebar.
- Select the relevant payroll cycle.
- Filter to view terminated employees by clicking on All Employees in the top right corner and selecting Leavers.
- Select the relevant employee.
- Click Add pay item and choose the relevant action.
FAQs
How is the gross salary adjustment calculated?
UK Payroll automatically calculates the gross salary adjustment using the day rate method in your Pay schedule settings. To set or change your company's day rate, see Add and edit pay schedule settings.
What if an employee owes money?
UK Payroll will show the amount owed by a terminated employee in the termination pop-up modal. You will need to recover this money outside of UK Payroll.
How are employee PAYE and pensions calculated?
UK Payroll automatically adjusts and refunds any overpaid tax, employee NI, and employee pension contributions based on the tax threshold over the backdated termination period.
The employee's P45 will be processed with the correct taxable earnings and tax paid to their leave date. The P45 will show the tax period as the month the termination was backdated to.
Tax, employee NI, and employee pension refunds will be offset against any overpaid salary when calculating the net over/underpayments due.
The employee's year-to-date figures will be updated on their final payslip, payroll reports, and the FPS submission to HMRC.
How are employer PAYE and pensions calculated?
UK Payroll automatically adjusts and refunds any overpaid employer NI and pension contribution based on the tax threshold over the backdated termination period.
You will need to contact your pension provider directly to recover any overpaid employee and employer contributions.