All employers are legally obliged to issue P60s to employees by 31 May. This is a deadline, so aim to send them before this date. You can use your payroll software, such as BrightPay, to produce them. They can be issued to employees in paper form or electronically. Employees need their P60 to claim back overpaid tax, to apply for tax credits, or as proof of income if applying for a loan or a mortgage.
You need to provide a P60 for each employee on the payroll who was working for you on the last day of the tax year (5 April). Therefore, you’re not required to issue P60s to employees who have left your business during the tax year.
Go paperless. We encourage employers to supply P60s digitally to employees. There are many digital options available to you in BrightPay such as email or through the secure online portal, BrightPay Connect. If you do decide to print P60s, there is no need to buy special print paper, as P60 layouts produced by BrightPay have been approved by HMRC for printing on to plain paper.
Read about BrightPay’s sustainability journey and goal of becoming net-zero by 2023.
If you miss the 31 May deadline to issue P60s to employees, you could face hefty fines from HMRC. The initial penalty for missing the deadline is £300, followed by an additional fine of £60 per day after that. So, if you miss the deadline, make sure to give your employees their P60s as soon as possible or the fine will keep increasing. However, if you miss the P60 deadline due to a genuine error and you take steps to issue the P60 as soon as possible, a fine is less likely.
To assist employers in completing the 2020/21 tax year and transitioning to tax year 2021/22, BrightPay have compiled a list of frequently asked questions, answered by payroll experts.
As you may know, we recently announced our very ambitious sustainability campaign to become net zero by 2023. To achieve this, our new offices are purpose built to be energy efficient, affording us the opportunity to record and monitor our carbon emissions. Following an initial period of review, we will look to offset our emissions with the ultimate goal of becoming truly carbon neutral.
To help raise awareness amongst our employees, we have established the BrightPay Green Team which is made up of 12 team members, across multiple departments. The Green Team have been working on coming up with creative ways to make the company's operations more environmentally friendly. They also aim to encourage change amongst colleagues on an individual level, at home, at work and in the community.
In our first campaign to raise awareness, the Green Team celebrated Earth Day 2021 (April, 22nd) with a number of activities planned throughout the week.
As we continue to work remotely, we encouraged everyone to get involved and share photos of their activities online.
The BrightPay Team getting involved in Earth Day celebrations.
We started off our ‘Earth Week’ with ‘Meat Free Monday’. The production of meat and dairy products account for around 14.5% of global greenhouse gas emissions each year and so we encouraged employees to eat vegetarian or vegan meals for the day. On Tuesday we encouraged employees to take a walk in their local area. On Wednesday we asked employees to unplug devices, cut down on emails and have a ‘digital clean-up' to save C02 emissions. Thursday, April 22nd, was Earth Day and to celebrate we had a live online talk from Dr Emma Reeves, Senior Ecologist at the Forest, Environmental Research & Services (FERS) Ltd who discussed reducing our waste, the benefits of living a more eco-friendly lifestyle and the small changes we as individuals can make to help the planet. Friday was ‘Fresh Friday’ where we encouraged employees to go litter picking in their local areas.
Earth week was a success and we accomplished what we set out to do, which was to raise environmental awareness amongst our colleagues and encourage involvement in the company's sustainability efforts.
We will continue our dedication to creating a greener future and reaching our goal of net zero by 2023. Subscribe to BrightPay’s sustainability newsletter to follow our journey.
Working from home became normality for many people since the beginning of the COVID-19 pandemic in March 2020, and still is one year later. A recent survey estimates that 60% of us are still working from the confines of our own homes.
Some good news is that if your employer requires you to work from home, you can benefit from the working-from-home allowance. Employers can pay you £6 a week extra tax-free. And if your employer doesn’t add this allowance to your payslip, you can claim it yourself.
Employees can claim tax relief for additional household costs if you have to work from home on a regular basis, either for all or part of the week. This includes if you have to work from home due to COVID-19. However, you cannot claim tax relief if you choose to work from home. You can apply through the government's dedicated site where you can also check if you are eligible to claim. To claim, you'll need a Government Gateway User ID and password.
Additional household costs include things like extra heating & electricity expenses, work-related calls, internet connection and metered water bills. They don’t include costs that would stay the same whether you were working at home or in an office, for example, rent.
You’ll get tax relief based on the rate at which you pay tax. For example, if you pay the 20% basic rate of tax and claim tax relief on £6 a week you would get £1.20 per week in tax relief (20% of £6). You do not receive this money by cheque as it is done by altering your tax code that indicates to your employer how much tax to take off your payslip. Less tax will be taken off your payslip, meaning you’ll take home more.
You may also be able to claim tax relief on equipment you’ve bought for work, such as a laptop, office chair or mobile phone.
You can now claim for the 2021/22 tax year.
With little automaton and integration, calculating payroll and settling payments can be a complicated end-to-end process. The complexity of traditional payment flows makes reconciliation difficult, and this is further compounded by an outdated banking infrastructure, with its reliance on manual process and file uploads.
As complexity increases, so too does cost. In the current economic climate, there may be a clear temptation to delay the technological upgrades required to streamline this process. But, as recent research has shown, by not shedding legacy technology and shoring up operational efficiency, companies are adopting an increasingly risky strategy – especially when it comes to the payment processes that sit at the very heart of a business – payroll.
What is clear from the research is that payment processes incur both hard and hidden inefficiencies. The biggest hard cost, as reported by 39% of businesses surveyed, is the hours spent on manual processes.
Depending on the payroll software used, the current payroll process can be error-prone and time-consuming - a fragmented process relying on manual entry, including:
The Bacs system has a 3-day cycle to payment completion so even once files are uploaded and payments are processed, there is still a wait for those payments to clear.
But, it’s the hidden costs that can pack a bigger punch, with 65% of employment services companies agreeing that these actually outweigh the hard costs.
Take, for example, the manual process of payroll - the hard cost is the salary paid against the quantifiable hours spent on the process, while the hidden cost is where those hours could have been better spent and the impact that it could have had on customer experience and satisfaction, competitor differentiation, brand reputation, business agility and team morale.
1. Be responsive to the needs of the Instant Economy
The Instant Economy – an economy of instant experiences, instant information and instant services in both consumer and business lives. But digital, real-time, and responsive business services are required to power the Instant Economy, and a fast digital payments solution must be at the heart of the services infrastructure.
The Instant Economy is increasingly becoming the benchmark for customer experience. When applying Instant Economy thinking to payments, it is not about making them happen quickly. That is just the start. It’s about building innovative products on top of a real-time and responsive, digital payments infrastructure.
Accountants and payroll bureaus need to innovate and evolve to meet the expectations of a market that is accustomed to the benefits of faster, more instant payments. And luckily this is now easier than they think, thanks to companies like BrightPay.
2. Use payment integrated payroll
Leveraging Modulr’s direct access to the critical payments infrastructure, BrightPay can now offer its customers an alternative to the legacy system and a more agile and reliable method of running payroll. This new functionality will integrate payroll and payment processes and remove the reliance on file upload to provide a better end-to-end solution for both accountants and payroll bureaus, and their clients.
The Modulr platform allows BrightPay to remove many of the manual processes currently used for payments processing and replace them with automation. This in turn reduces both the financial impact of the hours spent on payroll and the number of manual errors made when processing payments, which becomes particularly critical for payroll bureaus dealing with multiple clients.
3. Automate to Innovate
Using end-to-end automation in this way is key to driving efficiency and reducing costs, both hard and hidden - replacing the legacy payroll system with a real-time and responsive, digital one, and reducing a two-hour process down to 30 seconds.
Payments can be triggered automatically, from one platform, incurring no more manual processing or checking that funds have cleared. There’s no need to extract files to upload to banking systems or wait for Bacs payments to clear and errors to surface; last minute changes can be processed at the last minute. Payments can be paid in seconds, even outside of banking hours and with full visibility for faster and easier reconciliation.
So, accountants and payroll companies tempted to put off the technological upgrades required to streamline what is traditionally a complicated, error-prone and time-consuming payroll process should take heed – delay and there’s a high price to pay. And, not just in terms of the hard cost of the process itself, but also the hidden costs which are now shown to be more far-reaching.
But there are alternatives. Digital technologies are revolutionising many of the traditional ways of doing things, including payroll, resulting in better end-to-end journeys. Automation and systems integration are the key to realising digital transformation ambitions, while reducing costs, both hard and hidden. And by harnessing Modulr technology, BrightPay can now offer its customers both.
BrightPay and Modulr are together transforming the way accountants and payroll bureaus do business, by streamlining and automating their payments and payroll processes. Book a demo of BrightPay today or watch this short video to see the BrightPay & Modulr integration in action. On 22 April, join the BrightPay and Modulr teams for a free webinar, as we explore what you need to know about this Direct Payments functionality. Plus, we will demonstrate how quick and seamless the process is in both BrightPay and Modulr.
The first Earth Day launched fifty-one years ago in response to an emerging environmental consciousness, catalysed by a number of environmental disasters in the ‘60s. Although the stakes only grow as the years go by, we can appreciate that there has been a profound cultural shift since it began.
At BrightPay we are committed to a cleaner, greener future for all. This commitment will see us developing our business towards ecological sustainability at both a company and an individual level. We recently announced our very ambitious sustainability campaign to become net zero by 2023. To achieve this, our new offices (opening soon!) are purpose built to be energy efficient, affording us the opportunity to record and monitor our carbon emissions. In addition to this, we have established the Green Team, an internal company initiative, to educate, promote and inspire sustainability among our colleagues and our loyal customers.
The Green Team members are brimming with ideas to identify and support the implementation of solutions to help BrightPay operate in a more environmentally sustainable way. Our plans, including those for Earth Day, are grounded in the belief that small actions at the individual level can build to create a larger change. We will leverage our individual power to influence, as an employee, a consumer, a voter, and as a member of our community.
In our first campaign to raise awareness, the Green Team will be celebrating Earth Day 2021 with a number of activities planned throughout the week. Take a look below at what we have planned. On Earth Day, we will be inviting Dr Emma Reeves, Senior Ecologist at the Forest, Environmental Research & Services (FERS) Ltd to discuss climate change, pollution, and what we as individuals can do to help.
Our dedication to the environment won’t stop at the end of the week. Subscribe to BrightPay’s sustainability newsletter to follow our journey.
With the Coronavirus Job Retention Scheme (CJRS) to remain in place until September 30th, 2021 in the hope of aiding economic recovery, we are going to look at some of the key milestones of the scheme so far and how the scheme will change between now and September.
The government paid 80% of furloughed employees wages up to a cap of £2,500, as well as employer National Insurance contributions and pension contributions. The rules at this time meant that employees had to be fully furloughed for a minimum of 21 days, and they were not allowed to work while they were on furlough.
CJRS entered its second phase on 1 July 2020, and during these few months, the CJRS was only available to employers that have used CJRS 1 and only for employees they have previously furloughed. The government contribution to employees’ wages reduced month-on-month as the scheme was winding down. There were also some benefits to this part of the scheme, as flexible furlough was introduced, allowing furloughed employees to return to work part time, with no minimum furlough period.
CJRS was once again due to end, but after mounting pressure, the scheme was extended at the eleventh hour, initially until March and then April of this year. The extended months of the furlough scheme were nicknamed CJRS 3 as it brought with it a new set of scheme rules, including the 80% government subsidy being reinstated.
During the Budget, the chancellor announced that the furlough scheme would be extended yet again, and this time, it has been extended until the end of September 2021. With this extension, apart from eligibility changes in May, the rules will continue as they are currently until the end of June. However, the levels of subsidy support will change again from 1st July, where employers will be asked to contribute a percentage of their employees' wage from July onwards as the scheme winds down.
The past year has been very frustrating for payroll processors. Not only had you the added workload of processing furlough pay and making subsidy claims, but you also had to learn about the various changes to the Coronavirus Job Retention Scheme.
There was a lot of time involved in learning, and keeping up to date with changes, which were being announced very frequently. At the beginning, there were times when changes were even being made every week, and it was difficult to keep up to date with the latest guidance.
At BrightPay, we kept the payroll software up to date to cater for the relevant scheme changes. We tried to automate as much as possible in the payroll software to make your life easier. BrightPay has a furlough pay calculator, including support for flexible furlough, which is something many other payroll software providers did not cater for. We also have a CJRS claim report, to make it easier for users when calculating amounts for furlough claims.
In a recent survey, BrightPay achieved a 98.6% rating for our overall handling of COVID-19 including customer support, payroll upgrades, COVID-19 webinars and online support. We also won a COVID-19 Hero Award, and this is because of our response to COVID-19 and how we have helped our customers throughout the past year. The judges recognised that we went above and beyond to support payroll professionals at a time when they were under pressure with government schemes and trying to interpret guidance.
Join our free webinar where we will discuss CJRS rule changes, furlough extensions and other HMRC quirks.
To learn more about BrightPay’s features and how they can benefit your business, book a free demo today.
The Coronavirus Job Retention Scheme (CJRS) has been in place for over a whole year now. With this milestone comes changes to how an employee's furlough pay should be calculated. If you’re in a position where employees are fully furloughed, you do not need to work out the employee’s usual hours and furloughed hours. However, if an employee is flexibly furloughed, you will be required to work out the employee’s usual hours, their actual hours worked and their furloughed hours for each claim period.
Regardless of whether these workers were actually placed on furlough, the following three rules should be followed when working out furlough pay.
For workers who were not eligible for furlough under the original scheme, for example, new joiners after the previous cut-off date of 19th March 2020, a different pay reference period exists.
Where these employees are contracted to work a fixed number of hours, the calculation is based on the wages payable in the last pay period ending on or before 30th October 2020.
Where neither 19th March 2020 nor 30th October 2020 reference dates apply, the employee is not eligible for periods starting before 1st May 2021. If you made a payment of earnings to the employee which was reported to HMRC on an RTI submission between 31st October 2020 and 2nd March 2021, they may be eligible for periods starting on or after 1st May 2021 and their reference date will be 2 March 2021.
For other employees, you’ll calculate ‘usual hours’ based on the average number of hours worked in the 20/21 tax year up to the day before the employee’s first day spent on furlough on or after either:
If you would like further information on how the furlough scheme rules are going to change between now and September 2021, join us for our upcoming free webinar where we will examine these changes and what they mean for your business.
Collaboration is at the centre of BrightPay’s plan of continuously addressing the challenges our customers face by ensuring we can offer new and innovative solutions. Our partnership with Modulr, the UK payments platform, achieves exactly this. The API integration will significantly simplify the task of managing payroll payments for thousands of our customers across the UK. Through Modulr, BrightPay’s customers can eliminate the need to create bank files and the manual work associated with making payments to employees.
The Modulr BrightPay integration enables accountants to provide their clients with a new service, the option of a seamless payroll workflow. Using Modulr, accountants and bureaus can offer accounts to individual clients, which allows payroll payments to be initiated within BrightPay payroll software without the need for payment files. Its functionality provides numerous benefits for accountants and their clients.
Modulr is the tech behind the tech. It’s likely you’ve been using their payments infrastructure without even knowing it. They are the award-winning payments partner behind Revolut, Sage, Iwoca and over 10,000 businesses (and millions of customers). The fintech company has established itself as a leading alternative to wholesale and commercial payments. It is FCA approved, has direct access to Faster Payments and is a partner of Visa, granting it direct access to the industry-leading global payments network.?
We want our customers to have the best experience possible and this collaboration with Modulr is an important step in this. We are confident that this partnership will improve the payroll workflow. We maintain that having a seamless payroll service should be available at an affordable price point and as our BrightPay customers know, we don’t believe in complicated pricing structures, opaque amounts or unfair selling tactics. That’s why BrightPay will not be receiving any referral fees for this service. This allows our customers who register with Modulr to avail of it at a highly competitive rate.
On Thursday, 22 April, join the BrightPay and Modulr teams for a free webinar, as we explore what you need to know about this Direct Payments functionality. Plus, we will demonstrate how quick and seamless the process is in both BrightPay and Modulr.
The furlough scheme has once again been extended, this time until the end of September 2021. The rules in relation to scheme eligibility, the levels of subsidy support, and the reference period used for newly eligible employees are all due to change between now and September.
We are delighted to announce our new API integration with even more accounting software solutions including Clear Books, FreshBooks, QuickFile and Zoho. This joins our growing list of Integration options created by us to ensure our customers save time and reduce the risk of errors.
BrightPay’s new integration with Modulr will give you a fast, secure and easy way to pay employees through BrightPay. Processing payroll and paying employees shouldn’t be separate tasks and we have a solution! Coming next week.
Here at BrightPay we take environmental responsibility very seriously and are committed to developing our business towards ecological sustainability at both a company and an individual level. Our new carbon efficient offices will open in 2021. Additionally, we are excited to announce our very ambitious sustainability campaign to become net zero by 2023. To achieve this, we have recently established a passionate Green Team to educate, promote and inspire sustainability to our employees and our loyal customers. Subscribe to BrightPay’s sustainability newsletter to follow our journey.