Payday filing

19 October 2018

David Ward, Advisory Partner |

There are just six months before payday filing becomes compulsory from 1 April 2019.

Payday filing is introduced with the aim of saving time for businesses and providing more timely and accurate information of taxpayers.  Payday filing was voluntary from 1 April 2018 and becomes mandatory from 1 April 2019.  It’s a good time now to confirm that your existing payroll software system is compatible for payday reporting.

In a nutshell, Employer monthly schedules (IR348) will no longer be filed and instead an employment information schedule is now filed in accordance with each pay cycle.  For new/departing employees, employee details must also be submitted on or before any new employees’ first payday.  Details include employees’ start and end date, contact details and date of birth.

While filing becomes more regular, the payment dates remain the same.  Employer deduction forms IR345 will continue to be filed with payment for at least the next few years until all PAYE information is processed in Inland Revenue’s new computer system (estimated for 2020).

The payday filing requirements are summarised in the table below:

Ensuring a smooth transition

To prepare for the PAYE reporting changes, we recommend you:

  • Confirm with their payroll software provider when the software will be ready for payday reporting;
  • Decide when the entity wishes to change to payday filing (noting they must start at the beginning of a calendar month);
  • Review and update the PAYE reporting processes and procedures, noting how to report certain special payments (i.e. out-of-cycle pays, shadow payroll payments and benefits under employee share schemes) correctly.

Contact us today for more advice.